Netlist beats Micron, wins price target raise at Roth

Following the results of a patent infringement trial, Roth MKM analyst Suji Desilva has raised his price target on Netlist (Netlist Stock Quote, Chart, News, Analysts, Financials NASDAQ:NLST).

On May 24, NLST announced it had won a $$5-million patent infringement suit against Micron.

“For 24 years, Netlist has been dedicated to developing advanced memory technologies and these patents emanate from the hard work of our engineers,” CEO C.K. Hong said. “This verdict marks the second time in just over a year that a jury has found willful infringement of our patents by a global semiconductor manufacturer. Juries fundamentally understand that the intentional unauthorized use of intellectual property created by others is improper. The $445 million awarded for past damages from Micron’s unauthorized use underscores the immense value of Netlist’s technology.”

The analyst assessed the development.

“NLST received a favorable jury verdict in its Texas patent infringement trial with Micron (MU-NC) in the amount of $445m,” he wrote. “On the back of the company’s recent favorable $300m+ patent litigation verdict with Samsung (005930.KSNC), we believe these recent trial outcomes affirm the technical strength of NLST’s memory patent portfolio. As in the Samsung case, we believe NLST’s patents remain enforceable despite recent PTAB findings”

In a research update to clients May 24, Desilva maintained his “Buy” rating and raised his price target on NLST from $2.00 to $4.00.

The analyst thinks Netlist will post EPS of negative $0.17 on revenue of $160.0-million in fiscal 2024. He expects those numbers will improve to and EPS loss of $0.08 on a topline of $210.0-million in fiscal 2025.