Why did Network-1 Technologies Inc soar 11%? $NTIP

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Network-1 Technologies, Inc. (NYSE MKT: NTIP), a company specializing in the development, licensing and protection of its intellectual property assets, today announced that Mirror Worlds Technologies, LLC (“MWT”), its wholly-owned subsidiary, has entered into an agreement pursuant to which it will receive $17.5 million in connection with a settlement of a professional liability claim relating to services rendered in 2008 – 2010.  Network-1, through its subsidiary MWT, acquired the claim in May 2013 as part of its acquisition of the patent portfolio of Mirror Worlds, LLC.

Shares in Network-1 rose 11% on the news to close at $2.31.

Who is Network-1 Technologies?

Network-1 Technologies, Inc. develops, licenses, and protects intellectual property assets.

It owns 27 patents that relate to various technologies, including patents covering the delivery of power over Ethernet cables for the purpose of remotely powering network devices, such as wireless access ports, IP phones, and network based cameras; foundational technologies that enable unified search and indexing, displaying, and archiving of documents in a computer system; enabling technology for identifying media content on the Internet; and systems and methods for the transmission of audio, video, and data over computer and telephony networks.

Network-1 has had a fantastic run since December 2015, with its share price soaring over 97%.

(Source: Google Finance)

We currently have Network-1 as the 9th most undervalued share in The Small and Micro Cap Screener here at The Acquirer’s Multiple.

This settlement further enhances my feeling that Network-1 is a great buy today. The company currently has a market capitalisation of $53 million, but with cash exceeding debt by $22 million, this gives it an Enterprise Value of $31 million. With operating earnings of $7 million that gives it an Acquirer’s Multiple of 4.85.

It’s currently trading on a price-to-earnings ratio of 11.68 and a Free Cash Flow/Enterprise Value of 10%. So, it certainly looks cheap.

If you’re looking for a great little micro cap to add to your portfolio, then I’d be certainly be considering Network-1.

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