Gilford Securities Reiterates a 'Buy' on VirnetX Holding (VHC); Clearing Up Some Concerns, Events and Articles

July 27, 2012 11:54 AM EDT
Get Alerts VHC Hot Sheet
Price: $2.35 +2.17%

Rating Summary:
    3 Buy, 1 Hold, 0 Sell

Rating Trend: = Flat

Today's Overall Ratings:
    Up: 19 | Down: 19 | New: 13
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Gilford Securities reiterates a 'Buy' on VirnetX Holding (NYSE: VHC) price target of $65.00.

Analyst, Robert V. Tango, Jr. is objectively examining a number of key issues and subjects that surfaced in recent weeks including: 1) ITC Filing - Certain investors feel the Judge has opted to dismiss the hearing (based on title/document 31), however, Tango believes the Judge hasn't dismissed the hearing and it will be heard; 2) A dismissal would not require filing of 2 documents, in his opinion - thus why file document 30? ITC hearing involve extremely strict procedures; 3) Will ITC hearing be delayed? Possible, but maybe for weeks to a few months, not 16-24 months; 4) Certain investors who believe the hearing will proceed assume SAIC (NYSE: SAI) may be enjoined (one theory as to why 2 filings were drafted), potentially increasing the “risk” for VirnetX as the involvement of additional parties/depositions/information increase the possibility of a legal loophole. Fact, the ITC hearing involves patent ‘181 only; 5) Does a scheduling alteration related to the ITC hearing imply a potential resolution between Apple (Nasdaq: AAPL) and VirnetX would be delayed by one or two years? Not necessarily – the fact the ITC agreed to hear this case (last December) implies how serious one of the most powerful governmental entities is reviewing the situation.

"New" Implications from the Recent Markman – Commentary, remarks, and
indications during the most recent Markman hearing on July 12th have raised new
questions despite Mitel’s decision to settle prior to the hearing and Judge Davis’
relatively strong language/tone, which we viewed as being very favorable for VirnetX.

Kendall Larsen’s Stock Pledge – It is understandable that investors get concerned
when a CEO pledges stock – tangible evidence suggests (based on similar actions by a handful of executives at other corporations) improper use/actions may occur...Based on filings, 100 % of his shares are restricted, implying they cannot be sold, or used in the marketplace for any transaction including “a borrow” – in our opinion not a single share has been used in the marketplace as a vehicle for institutional activities.

For an analyst ratings summary and ratings history on VirnetX Holding click here. For more ratings news on VirnetX Holding click here.

Shares of VirnetX Holding closed at $25.28 yesterday.

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