WiLAN

Ottawa-based WiLAN (TSX: WIN) is a developer, acquirer, and licensor of patents, primarily related to wireless technology. The company’s portfolio includes 4,000 patents, which the company uses mainly to pursue licensing revenue.

The great thing about licensing agreements is that they lead to recurring revenue with very high margins. The only problem is that WiLAN has to regularly sue companies that infringe on the company’s patents; otherwise, wireless technology companies would have little incentive to sign licensing agreements.

WiLAN’s business model leads to very volatile earnings numbers. And recently, the deal flow has slumped, depressing both earnings and the share price. In fact the shares are down 35% since July 2013, so now may be the perfect opportunity to steal some shares at a bargain price.

If I buy any more bargain priced stocks I shall definitely have to declare bankruptcy.

Doc