Forgent (NASDAQ:FORG)
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Dutton Associates continues its coverage of Forgent
Networks, Inc. (NASDAQ:FORG), maintaining its Strong Buy rating. The
13-page report by Dutton senior analyst Richard W. West, CFA is
available at www.jmdutton.com as well as from First Call, Bloomberg,
Zacks, Reuters, and other leading financial portals.
Forgent Networks, Inc. (Forgent) started litigation to protect
another of its more than 20 unexpired patents. On July 14, 2005,
Forgent filed a lawsuit against 15 cable TV providers, including:
Cable One Inc, Charter Communications, Comcast Corp., EchoStar
Communications, The DIRECTV Group, and Cox Communications. The lawsuit
covers the possible infringement relating to their patent covering a
computer-controlled video system that allows playback during
recording. During playback, the system reads the video content from
the storage component. This is the second market in which Forgent is
actively protecting its patents through litigation. Forgent's efforts
concerning the protection of its Compression Labs (CLI) subsidiary's
U.S. Patent (the '672 patent) appear to have stalled since our Update
Research Report (4/01/05). Forgent has, over the past three years,
licensed 38 companies from a wide variety of businesses and recorded
revenues of $102.0 million in lump-sum payments and/or royalties. Four
defendants settled since Forgent initiated patent litigation.
Forgent's past IP revenues of over $102.0 million, the possible future
IP revenues, and the strong balance sheet are, in our judgment, not
reflected in the current stock market valuation of these shares.
Therefore, we believe Forgent's common stock provides investors with
above-average capital-gain potential with limited downside risk.
About Dutton Associates
Dutton Associates is one of the largest independent investment
research firms in the U.S. Its 27 senior analysts are primarily CFAs
and have expertise in many industries. Dutton Associates provides
continuing analyst coverage of over 100 enrolled companies, and its
research, estimates, and ratings are carried in all the major
databases serving institutions and online investors.
The cost of enrollment in our one-year continuing research program
is US $35,000 prepaid for 4 Research Reports, typically published
quarterly, and requisite Research Notes. The Firm does not accept any
equity compensation. We received $33,000 from the Company for 4
quarterly Research Reports with coverage commencing on 12/21/2004. Our
principals and analysts are prohibited from owning or trading in
securities of covered companies. The views expressed in this research
report accurately reflect the analyst's personal views about the
subject securities or issuer. Neither the analyst's compensation nor
the compensation received by us is in any way related to the specific
ratings or views contained in this research report or note. Please
read full disclosures and analyst background at www.jmdutton.com
before investing.