Immersion (IMMR, NASDAQ)
I introduced this company to subscribers June 6, 2022, when it was trading at $5.57 a share. Immersion (IMMR, NASDAQ) closed Friday at $6.83, so the gain since June has been a respectable 23%.
The stock was as high as $7.29 this past week and is up 28% already this month.
$6.83 per share | $229 million dollar (U.S.) market cap | $133 million cash
IMMR delivers a “feel good” Q3 report:
- Revenues increase 94% to $14 million, vs. $7.2 million
- GAAP net income nearly doubled to $0.23 per share, from $0.12
- Repurchased more than 2.5 million IMMR shares YTD, or 7.4% of all shares outstanding
- Declared $0.03 quarterly dividend
Immersion also renewed a multi-year agreement with Google pursuant to which Google has obtained a license to Immersion’spatent portfolio for Google and Fitbit products.
Eric Singer, Executive Chairman, stated, “Notwithstanding a very difficult macroeconomic backdrop, Immersion’s financial strength allowed for significant share repurchases during the quarter of 954,247 shares. On a year-to-date basis, we repurchased 2,542,065shares (7.4% of shares outstanding at December 31, 2021) at an average price of $5.20 per share.”
Singer continued, “In addition, the Board of Directors has approved a quarterly cash dividend of $0.03 per share, which underscores our confidence in the financial strength of the company and commitment to return capital to shareholders in a meaningful way. We are focused on renewing license agreements, protecting our intellectual property and pursuing thoughtful capital allocation to drive long-term shareholder value.”
Breakthrough quarter for Immersion and it resulted in IMMR breaking above its 200-day EMA, currently $5.55.
This is the beginning of what will be a major multi-year move for IMMR, imo. A classic technical analysis observation is that “the bigger the base the bigger the space”, implying how long drawn-out sideways (consolidation) patterns lay firm groundwork for price launches.
IMMR has been trading sideways, basically between $5 and $15 per share, for more than a decade. A significant amount of time and space. If and when it breaks out of that range we could be talking about a $30 to $50 share price.
As a friendly reminder – haptics is the “touchy-feely” technology that will permeate everything.
Immersion is a royalty and licensing kingpin when it comes to haptics technology.
With 1,600+ patents this company controls vast amounts of intellectual property relative to all things haptics. For many years to come they’ll be very busy licensing their haptics technology, collecting royalties, and suing those who don’t honor their IP.
This is the company that successfully sued Samsung and Sony for patent infringement (Facebook’s Meta VR platform is next – the complaint was filed in May with a U.S. district court).
Notable new licensing agreements year-to-date (adding to a list of the who’s who of big tech like Google, Sony, and Samsung) include lesser known names but mega corporations like Mobase Co., an international supplier of automotive systems and products, and ELAN Microelectronics, a leading human-machine interface solution provider with supposedly $600+ billion revenues.
Mobase will use Immersion’s haptics for touch screens in automobiles.
ELAN will use Immersion inside its Smart-Haptic pad technology for laptops and other handheld devices. This new customer/licensee was a huge new get during the quarter.
Immersion is a royalty company. IMMR is a vehicle by which investors gain exposure to the leading patent portfolio for haptics technology (the touch-feely stuff). Pretty cool stuff. Only recently has the stock started to get hot.