Seeking Alpha

jleisure7's  Instablog

jleisure7
Send Message
Finance Student at Bentley University
View jleisure7's Instablogs on:
  • Vringo's Huge and Obvious Upside Potential

    Vringo (NASDAQ:VRNG) has won a definitive victory over Google; now what? Let's look at one possible method of valuation. With their ongoing 3.5% royalty rate, Vringo stands to receive payments of about $150 million per year for the next four years. Subtract applicable taxes and operating expenses, and we can conservatively say that Vringo will take home about $100 million in cash (this is strictly from the (NASDAQ:GOOG) settlement) per year. $100 million divided by Vringo's 33 million shares outstanding yields an EPS of $3.03. Now take that EPS, and multiply it by the average P/E of Vringo's sector applied technology, which is 17, and you end up with a rudimentary PPS estimate for Vringo. That number? $51.51 per share. I don't know about the rest of you, but I struggle to see how this stock could go anywhere but up.

    PS, before anyone tries to say i am just trying to pump the stock price, go over my numbers yourself. They are accurate and represent a factual means of approximating PPS.

    Disclosure: I am long VRNG.

    Nov 23 8:11 AM | Link | 10 Comments
Full index of posts »
Latest Followers

Latest Comments


Most Commented
Posts by Themes
Instablogs are Seeking Alpha's free blogging platform customized for finance, with instant set up and exposure to millions of readers interested in the financial markets. Publish your own instablog in minutes.