How AOL's Microsoft Deal Could Boost RIM
NEW YORK (TheStreet) - AOL's(AOL) deal to sell Microsoft(MSFT) over $1 billion in patents only intensifies the war for patent portfolios, potentially benefitting companies like Research In Motion(RIMM) and InterDigital(IDCC) .
Miller Tabak analyst David Joyce, for example, notes that the Internet patent market is "increasingly strong", as competition for key technologies increases. Joyced upped his price target on AOL to $30, and kept his "buy" rating.
AOL's patents were thought to be worth around $300 million, according to Benchmark analyst Clayton Moran. "We believe most on the Street viewed $300 million as the likely maximum value. Relative to this expectation, AOL has created $7.63 per share in stock value," Moran wrote, in a research note. The analyst rates AOL "hold" and upped his price target to $28 from $18.
The intensifying patent market could therefore be a boon for companies like InterDigital, which tried to sell its patent portfolio throughout 2011 to unlock value. Ultimately, however, InterDigital did not receive the price it wanted for its portfolio, and pulled the sale. The wireless specialist was hoping to receive as much as $3 billion for its patents, according to reports by the New York Times.