VirnetX Holding Corporation (NYSEMKT: VHC)
VirnetX Holding Corporation is having an incredibly strong day in the market today, and for good reason. The company has announced a legal victory over the tech giant, Apple. Today, we’ll talk about the news, what we saw from the stock as a result, and what we can expect to see from VHC ahead. So, let’s get right to it…
VHC Wins Against AAPL
As mentioned above, VirnetX Holding Corporation is having a strong day in the market today after winning a case against Apple. Early this morning, the United States Court for the Eastern District of Texas, Tyler Division brought down the gavel in a patent infringement case. In the case, VHC said that Apple infringed on four of the company’s patents, and the court agreed.
As a result, the court issued VHC a settlement in the amount of $302.4 million. What’s more, this is the third time that the company has claimed victory over Apple in a patent infringement case. The virdict brought down the line this morning includes royalties that have been awarded to VirnetX, as payment for unresolved issues in the Apple I case. In a statement, Kendall Larsen, VHC CEO and President, had the following to offer…
“We are extremely pleased with the jury verdict announced today… This is the third time a jury has confirmed that Apple has been using the technology developed by our inventors.”
How The Stock Reacted To The News
As investors, one of the first things that we learn is that the news moves the market. Any time positive news is released with regard to a publicly traded company, we can expect to see gains in the stock associated with that news. Adversely, when negative news is released, we can expect to see declines. In this particular case, the news released with regard to VHC was overwhelmingly positive. After all, for the third time, a court has determined that Apple has infringed upon patents held by the company. Perhaps more importantly, this is the third time that a court has made Apple pay for their infringement with a relatively large settlement. As a result, we’re seeing big gains in the value of the stock today. Currently (10:43), the stock is trading at $4.10 per share after a gain of $1.04 per share or 33.99% thus far today.
What We Can Expect To See Moving Forward
Moving forward, I have a relatively mixed opinion of what we can expect to see from VirnetX Holding. First and foremost, the news of the ruling was overwhelmingly positive. However, at this point, I believe that we’re seeing a bit of an overreaction. So, I wouldn’t be surprised to see a correction in the short run as traders take their profits. However, in the long run, my view with regard to VHC is relatively positive. At the ed of the day, the company’s innovation has earned it government contracts as well as other contracts among loyal customers. Now, the innovation has led to three settlements brought down by the courts as Apple relied on the company’s technologies. All in all, it seems as though the foundation is solid and VHC is ready for more growth.
What Do You Think?
Where do you think VHC is headed moving forward? Join the discussion in the comments below!