Ericsson (ERIC - Free Report) recently announced that it has entered into a license agreement with Intellectual Ventures, which put an end to all patent infringement lawsuits between the two companies. Markedly, the agreement includes a lawsuit that was trialed earlier this year and ended up in $43 million jury verdict in favor of the patent licensing company.
Since 2012, Intellectual Ventures has lodged a number of patent infringement lawsuits against the Swedish telecom equipment provider and its customers in the United States and Europe asking for injunctions and monetary compensations.
Ericsson boasts a leading position in telecommunications innovation and has a strong commitment to R&D. While the terms of the deal remained undisclosed, management anticipates an unfavorable impact on operating income within the company’s Networks segment in second-quarter 2019.
Additionally, the company has one of the industry’s strongest intellectual property portfolios, which includes more than 49,000 granted patents globally. It is reportedly the largest holder of standard essential patents for mobile communication.
Ericsson continues to execute its strategy and is on track to achieve its 2020 financial targets. It is investing in its competitive 5G-ready portfolio to enable seamless migration to 5G technology. The company also controls its cost position to stay profitable.
Moreover, Ericsson’s R&D investments over the past two years have secured a competitive and industry-leading offering. Artificial intelligence and automation remain key enablers for the company’s future business development, creating customer and shareholder value. Ericsson remains confident in reaching long-term target for 2020 and 2022.
Driven by diligent execution of operational strategies, shares of Ericsson have returned 37.1% compared with the industry’s rise of 9.8% in the past year.
Currently, Ericsson sports a Zacks Rank #1 (Strong Buy). Other top-ranked stocks in the industry include Juniper Networks, Inc. (JNPR - Free Report) , Motorola Solutions, Inc. (MSI - Free Report) and Ubiquiti Networks, Inc. , each carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Juniper has long-term earnings growth expectation of 6.2%.
Motorola has long-term earnings growth expectation of 7.7%.
Ubiquiti has long-term earnings growth expectation of 19.8%.
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