Fact based stock research
InterDigital (NasdaqGS:IDCC)

US45867G1013

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For every stock, we judge its performance against its peers and rank it on a scale of 1 to 100. The higher the rank, the better the stock performs than its peers. And, we do this for six investment strategies:
Value - shows how good of a value the stock is. Green is "inexpensive"; red is "expensive".

Growth - shows a company's growth potential. Green is "high growth" expected; red is "tough times ahead".

Safety - relates to the amount of debt a company has. Green is low debt level; red is high debt level.

Combined Financial - this isn't an average of the first three ranks but rather a consolidated view across several financial indicators. Green = good; red = tread carefully.

(NEW) Sentiment - quantifies professional analyst ratings and holdings as well as market pulse. Green = positive sentiment; red = skepticism (Only available to Premium Subscribers).

(NEW) 360° View - the ultimate rating with all financial and non-financial indicators.

InterDigital stock research in summary

interdigital.com

ANALYSIS: With an Obermatt Combined Rank of 77 (better than 77% compared with investment alternatives), InterDigital (Application Software, USA) shares have much better financial characteristics than comparable stocks. Shares of InterDigital are a good value (attractively priced) with a consolidated Value Rank of 64 (better than 64% of alternatives), show above-average growth (Growth Rank of 50), and are safely financed (Safety Rank of 65), which means low debt burdens. ...read more

RECOMMENDATION: A Combined Rank of 77, is a strong buy recommendation based on InterDigital's financial characteristics. As the company InterDigital's key financial metrics all exhibit excellent performance, such as good value (Obermatt Value Rank of 64), above-average growth (Obermatt Growth Rank of 50), and indicate that the company is safely financed (Obermatt Safety Rank of 65), it is a solid stock investment where the risk of paying too much for the share is limited, unless the company has a bleak future. Such good financial performance can indicate that the company's future might actually be challenging, as it may be difficult to maintain the good performance. If they are safely financed and have been growing above average, and are still a good value, it means that the market is keeping prices low, for a reason which may become clearer over time. We recommend evaluating the future of InterDigital. If you believe the company's future is market-typical or even better, this could be an argument for a share purchase. Obermatt Premium subscribers can further check the stock’s Sentiment Ranks, which also flow into the Obermatt 360° View for investors. ...read more

Latest Obermatt Ranks


360° View^new
Sentiment Rank^new
Value Rank	64
Growth Rank	50
Safety Rank	65
Combined Rank	77

Country	USA
Industry	Application Software
Index	NASDAQ, S&P MIDCAP
Size class	Medium

19-Dec-2024. Stock data may be delayed. Log in or sign up to get the most recent research.

Further information

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Review the performance ranks of the individual metrics that form each investment strategy.

Research History: InterDigital

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	13	97	69	64
GROWTH
GROWTH	6	49	58	50
SAFETY
SAFETY	82	88	86	65
SENTIMENT
SENTIMENT	n/a	77	92	^new
360° VIEW
360° VIEW	n/a	99	100	^new

Most recent update of the stock research: 19-Dec-2024. Financial reporting date used for calculating ranks: 30-Sep-2024. Stock research history is based on the Obermatt Method. The higher the rank, the better InterDigital is in the corresponding investment strategy.
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Combined financial peformance in Detail

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	13	97	69	64
GROWTH
GROWTH	6	49	58	50
SAFETY
SAFETY	82	88	86	65
COMBINED
COMBINED	13	90	91	77

Last update of combined financial performance: 19-Dec-2024. Stock analysis on combined financial performance: The higher the rank of InterDigital the better the performance.

Value Metrics in Detail

ANALYSIS: With an Obermatt Value Rank of 64 (better than 64% compared with alternatives), InterDigital shares are more attractively priced than the majority of comparable stocks. The Value Rank is based on consolidating four value indicators, with three out of four indicators below average for InterDigital. Only the metric dividend yield has an above-average rank, reflecting that dividend practices are expected to be higher than 96% of comparable companies, making the stock an attractive buy for dividend investors. However, dividend investors may get disappointed because all other critical financial indicators are below the market median: Price-to-Sales is 25 which means that the stock price compared with what market professionals expect for future profits is higher than 75% of comparable companies, indicating a low value concerning InterDigital's sales levels. The same is valid for Price-to-Profit (also referred to as price-earnings, P/E) with a rank of 47 which means that the stock price compared with what market professionals expect for future profit levels is higher than 53% of comparable companies. In addition, Price-to-Book (also referred to as market-to-book ratio) with a Price-to-Book Rank of 38 is also low. Compared with invested capital, the stock price is higher than for 62% of comparable investments. ...read more

RECOMMENDATION: The overall picture with a consolidated Value Rank of 64, is a buy recommendation based on InterDigital's stock price compared with the company's operational size and dividend yields. Should dividend investors pick InterDigital? The company-reported financials speak against it. The company is expensive compared with revenue and invested capital levels, two reliable company size indicators. In addition, it currently has a low level of profits. How can future dividends be paid in the case that profits remain low? Dividend investors should choose InterDigital only if they reasonably expect the low current profit levels to be transitory. We recommend further analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks, including the 360° View, before making an investment decision, which is essential in this case, as the financial indicators are inconclusive. ...read more

VALUE METRICS	2021	2022	2023	2024
PRICE VS. REVENUES (P/S)
PRICE VS. REVENUES (P/S)	63	58	26	25
PRICE VS. PROFITS (P/E)
PRICE VS. PROFITS (P/E)	6	65	59	47
PRICE VS. CAPITAL (Market-to-Book)
PRICE VS. CAPITAL (Market-to-Book)	10	84	35	38
DIVIDEND YIELD
DIVIDEND YIELD	16	99	96	96
CONSOLIDATED RANK: VALUE
CONSOLIDATED RANK: VALUE	13	97	69	64

Last update of Value Rank: 19-Dec-2024. Stock analysis on value ratios: The higher the rank, the lower the value ratio of InterDigital; except for dividend yield where the rank is higher, the higher the yield.

Growth Metrics in Detail

ANALYSIS: With an Obermatt Growth Rank of 50 (better than 50% compared with alternatives), InterDigital shows an above-average growth dynamic in its industry. Investors also speak of positive momentum. The Growth Rank is based on consolidating four value indicators, with half of the indicators below and half above average for InterDigital. Profit Growth has a rank of 67, which means that currently professionals expect the company to grow its profits more than 67% of its competitors. This is a good sign for shareholders, which is confirmed by an above-average Stock Returns rank of 89 (above 89% of alternative investments). But Sales Growth has a below the median rank of 1, which means that, currently, professionals expect the company to grow less than 99% of its competitors, and Capital Growth also has a lower rank of 49. ...read more

RECOMMENDATION: The overall picture with a consolidated Growth Rank of 50, is a buy recommendation for growth and momentum investors. Because revenues and invested capital are the more solid growth indicators, the positive development on the profit side is less relevant. It may have been caused by cost-cutting, which may be a negative growth indicator. Finally, the above-average stock returns recently are a thing of the past and not a good indicator of future returns. Investors should be confident that the cost-cutting initiative leading to higher profits is to benefit the company's future. If not, there is little growth momentum, and investment is only advisable if the Value Ranks suggest a good investment timing for InterDigital. While momentum is a popular investment factor, the value aspect might be the more important one, in the longer term. We recommend analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks to arrive at a 360° View of the stock purchase case, especially since the growth performance is mixed here. ...read more

GROWTH METRICS	2021	2022	2023	2024
REVENUE GROWTH
REVENUE GROWTH	24	5	6	1
PROFIT GROWTH
PROFIT GROWTH	6	44	87	67
CAPITAL GROWTH
CAPITAL GROWTH	n/a	80	16	49
STOCK RETURNS
STOCK RETURNS	38	75	95	89
CONSOLIDATED RANK: GROWTH
CONSOLIDATED RANK: GROWTH	6	49	58	50

Last update of Growth Rank: 19-Dec-2024. Stock analysis on growth metrics: The higher the rank, the higher the growth and returns of InterDigital.

Safety Metrics in Detail

ANALYSIS: With an Obermatt Safety Rank of 65 (better than 65% compared with alternatives), the company InterDigital has financing practices on the safer side, which mean that their overall debt burden is lower than average. This doesn't mean that the business of InterDigital is safe, it only means that the company is on the safer side regarding possible bankruptcy, assuming that public reporting is correct. The Safety Rank is based on consolidating three financing indicators, with two out of three indicators above-average for InterDigital. Refinancing is at 53, meaning the portion of the debt that is about to be refinanced is below average. It has less debt in the refinancing stage than 53% of its competitors. Liquidity is also good at 78, meaning the company generates more profit to service its debt than 78% of its competitors. This indicates that the company is safer when it comes to debt service. However, Leverage is rather large at 34, which means the company has an above-average debt-to-equity ratio. It has more debt than 66% of its competitors. ...read more

RECOMMENDATION: With a consolidated Safety Rank of 65 (better than 65% compared with alternatives), InterDigital has a financing structure that is safer than that of its competitors. This is not bad if things go well. The higher debt level means better returns to shareholders if things go well. Many top-performing companies operate with higher debt levels, and InterDigital could be in that group. But if you expect the environment to turn rougher, the higher leverage could become a problem. The same is valid if you expect interest rates to rise. That could squeeze shareholder returns, which so far have benefitted from better conditions. In the long-term, investors may have a debt challenge with InterDigital and should also compare Obermatt’s Value, Growth, and Sentiment Ranks before making a decision. ...read more

SAFETY METRICS	2021	2022	2023	2024
LEVERAGE
LEVERAGE	94	42	32	34
REFINANCING
REFINANCING	8	95	91	53
LIQUIDITY
LIQUIDITY	89	67	77	78
CONSOLIDATED RANK: SAFETY
CONSOLIDATED RANK: SAFETY	82	88	86	65

Last update of Safety Rank: 19-Dec-2024. Stock analysis on safety metrics: The higher the rank, the lower the leverage of InterDigital and the more cash is available to service its debt.

Sentiment Metrics in Detail

SENTIMENT	2021	2022	2023	2024
ANALYST OPINIONS
ANALYST OPINIONS	n/a	100	100	^new
OPINIONS CHANGE
OPINIONS CHANGE	n/a	87	50	^new
PRO HOLDINGS
PRO HOLDINGS	n/a	3	98	^new
MARKET PULSE
MARKET PULSE	n/a	54	57	^new
CONSOLIDATED RANK: SENTIMENT
CONSOLIDATED RANK: SENTIMENT	n/a	77	92	^new

Last update of Sentiment Rank: 19-Dec-2024. Stock analysis on sentiment metrics: The higher the rank, the more positive the sentiment for InterDigital.
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