PRKR was up another 30% yesterday, briefly hitting $1.05 before closing at 97 cents. This analysis values the shares at “a probability-adjusted $10.64.”
The report was paid for by the company. Though the authors do have a degree of independence, one can assume the report is largely based on the company’s own views. If PRKR loses all its lawsuits, the stock would likely be worthless. And if it wins one or more, who’s to say they will win nearly as much as the authors assume?
On the other hand, if the company does win its lawsuits, then the 62% probability of success that was used to weight the results goes to 100% and the $10.64 goes to more like $17. And if the company were to be awarded interest and legal fees — and/or the judge in the Qualcomm case decides to award something approaching the treble damages he’s authorized to impose, I would never have to work another day in my life.
I can’t say whether $10.64 is a fair probability-adjusted valuation for PRKR shares. But cut it in half. And then cut it in half again. And still the stock could more than double from here.
With money you can truly afford to lose, it may still be a good bet.
(And unlike BOREF, we may not have six million years to wait. The biggest of the trials is set to begin little more than three months from now.)
Fred Campbell: “CTHR has doubled. Is it time to take any profits?”
→ Suggested last March around 77 cents, it closed last night at $1.67, up 13% on very heavy volume. I like to think someone smart thinks it’s undervalued. I’m in no rush to sell.
> “Cut your losses and let your profits run” was the mantra of many a millionaire.
So don’t sell! A year or two from now, CTHR could be $3!
> “The bulls make money and the bears make money — but the pigs get slaughtered.”
Don’t be a pig. Take your double and sell!
> He who hesitates is lost! Yet haste makes waste!
I’m so confused!
So maybe do what King Solomon did? Sell half, to recoup your investment, and hold the rest?
Quote of the Day
Wealth is the parent of luxury and indolence, and poverty of meanness and viciousness, and both of discontent.~Plato
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