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InterDigital (NASDAQ:IDCC) shares rose nearly 7% on Wednesday as Bank of America upgraded the tech company, citing "impressive" first-quarter results and a "robust" pipeline.
Analyst Tal Liani raised his rating on InterDigital (IDCC) shares to buy from underperform and boosting the per-share price target to $105 from $55, noting that the company has a number of catalysts over the next one to two years to make the firm more constructive on the stock.
"The stock is up 63% [year-to-date], yet we view potential licensing agreements with Lenovo, Oppo, and Vivo as key medium-term drivers," Liani wrote in an investor note.
Liani also pointed out that InterDigital (IDCC) is currently in binding arbitration with Samsung (OTCPK:SSNLF) and recently received a favorable ruling in the Lenovo case and though the company already recognizes these revenues, there could be upside once both situations are finished.
If the cases with Vivo and Oppo are also resolved favorably, they should each add between $40M and $60M in recurring revenue per year to InterDigital (IDCC), Liani added.
"In addition, we see stock upside from continued growth beyond wireless into CE, IoT, and Autos, and note that strong share buybacks are adding to the stock’s attractiveness," Liani posited.
InterDigital (IDCC) reported first-quarter results earlier this month that topped expectations.
Analysts are overwhelmingly bullish on InterDigital (IDCC). It has a BUY rating from Seeking Alpha authors, while Wall Street analysts rate it a BUY. Conversely, Seeking Alpha's quant system, which consistently beats the market, rates IDCC a STRONG BUY.