Revenue Performance - Generated $23.3 million in consolidated revenue for Q3 2024, up 131% from $10.1 million in Q3 2023[4] - Total revenues for the three months ended September 30, 2024, were $23.3 million, a significant increase from $10.1 million in the same period last year, representing a 130.7% growth[13] - Total revenues for the three months ended September 30, 2024, were $23.31 million, a significant increase from $10.08 million in the same period of 2023, representing a 131.5% year-over-year growth[25] - Energy Operations contributed $15.8 million in revenue, while Industrial Operations generated $7.0 million, reflecting a decrease from $8.3 million in the same quarter last year[10] - Intellectual property operations generated revenues of $0.49 million for the three months ended September 30, 2024, compared to $1.76 million in the same period of 2023, reflecting a decline of 72.2%[25] - Energy operations reported revenues of $15.82 million for the three months ended September 30, 2024, with no revenues recorded in the same period of 2023, indicating a strong market entry[25] Financial Losses - Recorded a GAAP net loss of $14.0 million, or $0.14 diluted net loss per share, compared to a net income of $1.6 million, or $0.03 diluted net income per share in Q3 2023[10] - GAAP net loss for the three months ended September 30, 2024, was $(14.0) million, compared to a net income of $1.6 million in the same period last year[13] - Net loss attributable to Acacia Research Corporation for the three months ended September 30, 2024, was $(13.99) million, compared to a net income of $1.64 million in the same period of 2023[26] - The company reported a basic net loss per common share of $(0.14) for the three months ended September 30, 2024, compared to $(0.02) for the same period in 2023[26] Operating Performance - Achieved Total Company Adjusted EBITDA of $1.7 million for Q3 2024, with Operated Segment Adjusted EBITDA of $6.9 million[4] - Total Company Adjusted EBITDA for the three months ended September 30, 2024, was $6,332 thousand, compared to a GAAP operating loss of $2,087 thousand[34] - For the nine months ended September 30, 2024, the consolidated total Adjusted EBITDA was $6,332 thousand, with Parent Costs at $(4,103) thousand[34] - The operating loss for the three months ended September 30, 2024, was $(10.3) million, an improvement from $(13.2) million in the prior year[13] - The operating loss for the three months ended September 30, 2024, was $(10.27) million, an improvement from $(13.15) million in the same period of 2023[25] - The Energy Operations reported a GAAP operating income of $156 thousand, with depreciation, depletion, and amortization expenses of $422 thousand[34] - The Industrial Operations had a GAAP operating loss of $(234) thousand, with depreciation and amortization expenses of $683 thousand[30] - Intellectual Property Operations Adjusted EBITDA was not specified for the three months ended September 30, 2024, but the GAAP operating loss was $(7,138) thousand[36] Cash Flow and Assets - Generated $70.4 million in operating cash flow during the nine months ended September 30, 2024[3] - Cash, cash equivalents, and equity investments measured at fair value totaled $374.2 million as of September 30, 2024, down from $403.2 million at December 31, 2023, primarily due to acquisitions and stock repurchases[16] - Cash and cash equivalents increased to $360.05 million as of September 30, 2024, up from $340.09 million as of December 31, 2023[24] - Total assets rose to $707.57 million as of September 30, 2024, compared to $633.55 million as of December 31, 2023, reflecting a growth of 11.6%[24] Liabilities and Equity - Total liabilities increased to $129.01 million as of September 30, 2024, compared to $43.94 million as of December 31, 2023, indicating a significant rise in financial obligations[24] - Acacia's total indebtedness was $70.0 million in non-recourse debt as of September 30, 2024, while the parent company's total indebtedness was zero[16] - Book value per share was $5.85 at September 30, 2024, down from $5.90 at December 31, 2023[3] - The book value per share as of September 30, 2024, was $5.85, which would have been $6.00 excluding non-recurring legal expenses of $14.9 million[17] Stock Repurchase and Acquisitions - Acquired Deflecto Acquisition, Inc. for $103.7 million, expected to generate approximately $128-$136 million in revenue in 2024[4] - Repurchased 3.0 million shares for $14.0 million as part of the stock repurchase program[3] - The company has repurchased 3,007,294 common shares for $14.0 million as part of its stock repurchase program, which has a cap of $20.0 million[18] - The company’s cash reserves were approximately $280 million for potential future transactions following the Deflecto acquisition[3] Other Financial Metrics - General and administrative expenses were $11.1 million, a decrease from $11.6 million in the same quarter last year[10] - Unrealized losses for the three months ended September 30, 2024, were $(4.1) million, compared to unrealized gains of $8.8 million in the prior year[13] - The company reported a realized hedge gain of $800 thousand for the three months ended September 30, 2024[34] - Legacy matter costs for Parent were $2,193 thousand for the three months ended September 30, 2024[34] - Stock-based compensation for the three months ended September 30, 2024, was $858 thousand, with $415 thousand attributed to Parent Costs[34] - The company emphasizes that Adjusted EBITDA is a non-GAAP financial measure intended to provide investors with useful supplemental information[34]

Core Viewpoint - The article discusses the investment position of the analyst in ACTG shares, indicating a beneficial long position through various means such as stock ownership and options [1]. Group 1 - The analyst expresses personal opinions regarding the investment without receiving compensation from any company mentioned [1]. - There is an emphasis on the lack of business relationships with any companies whose stocks are discussed in the article [2]. - The article highlights that past performance is not indicative of future results, and no specific investment recommendations are made [3].

Core Insights - The article discusses the investment potential of ACTG shares, highlighting a beneficial long position held by the analyst [1]. Group 1 - The analyst expresses a personal opinion on ACTG shares, indicating a positive outlook based on their own analysis [1]. - There is no compensation received for the article, suggesting an independent viewpoint [1]. - The article does not provide specific investment recommendations or advice, maintaining a neutral stance on suitability for investors [2].

Financial Data and Key Metrics - Consolidated revenue for Q2 2024 was $25.8 million, up 227% YoY and 121% compared to the first six months of 2023, driven by the acquisition of operated producing wells in the Western Anadarko Basin [8] - Intellectual property operations revenue increased by $4.9 million YoY due to more license agreements executed during the quarter [8] - Energy operations delivered $14.2 million in Q2 revenue, while industrial operations revenue decreased by $1.2 million due to lower printer sales [8] - Adjusted EBITDA for the intellectual property business was $8.5 million, Printronix generated $2.3 million, and Benchmark generated $8.4 million in the first six months of 2024 [9] - Book value per share was $5.95 as of June 30, 2024, compared to $5.90 at the end of 2023 [10] Business Line Performance - Intellectual property business generated $5.3 million in licensing revenue, up over 200% YoY due to increased license agreements and higher average fees [20] - Printronix (industrial operations) generated $6.3 million in revenue, down from $7.5 million YoY due to lower printer sales, but operating losses decreased due to cost improvements [17][21] - Benchmark (energy operations) delivered $14.2 million in revenue, with $7 million in adjusted EBITDA for Q2, reflecting partial results from the April acquisition [14][21] Market and Strategic Focus - Acacia focuses on acquiring businesses with stable cash flow generation and scalability, particularly in Technology, Energy, and Industrials [6][7] - The company’s energy strategy involves acquiring mature, long-lived assets and optimizing production through field enhancements and low capital intensity [13] - Acacia’s intellectual property business continues to evaluate new patent portfolios for acquisition, with the Wi-Fi 6 portfolio representing a lucrative opportunity [15][16] Management Commentary on Environment and Outlook - Management remains cautious about market volatility but believes the impact on underlying businesses will be negligible [18] - The M&A environment remains constructive, with a strong pipeline of opportunities, particularly in oil and gas, industrials, and technology [18][19] - Acacia’s strategic relationship with Starboard enhances its sourcing and operating network, providing access to industry expertise and acquisition opportunities [26] Other Important Information - Acacia’s cash, cash equivalents, and equity securities totaled $405.2 million as of June 30, 2024, with no parent company debt and $82 million in non-recourse debt at Benchmark [24][25] - The company’s hedge book covers approximately 70% of net oil and gas production over the next three years, with significant realized and unrealized derivative gains and losses [14] Q&A Session Summary Question: Share buyback plans - Acacia is evaluating the timing of executing its authorized share buyback program [28] Question: Benchmark revenue expectations for Q3 - Management suggested interpolating revenue estimates for Q3 based on data provided in the investor deck [30] Question: Benchmark’s operating income ratio - Management highlighted that EBITDA is a better metric for evaluating profitability, with the business performing as expected [32] Question: Drivers of Benchmark’s revenue growth - Revenue growth will be driven by operational improvements to existing wells, cost optimization, and potential partnerships for undeveloped acreage [34][35][36] Question: G&A expenses related to Benchmark - Acacia consolidates 73.5% of Benchmark’s G&A expenses, with adjustments for minority interest [38] Question: Printronix turnaround progress - Management is pleased with Printronix’s progress in transitioning to higher-margin consumables and reducing operating costs [41] Question: Operating cash flow for H1 2024 - The $71 million operating cash flow was driven by patent settlements recorded as revenue in Q4 2023, with cash received in H1 2024 [45]

Financial Performance - Total revenues for the quarter ended June 30, 2024, were $25.8 million, a significant increase from $7.9 million in the same quarter of 2023, representing a 227% year-over-year growth[25]. - The net loss attributable to Acacia Research Corporation for the quarter was $8.4 million, an improvement from a net loss of $18.8 million in the same quarter of 2023[22]. - Basic net loss per common share was $0.08, compared to $0.36 in the prior year, indicating a reduction in loss per share[23]. - Total costs and expenses for the quarter were $30.6 million, up from $20.4 million in the same quarter of 2023, reflecting increased operational activities[25]. - Operating loss for the quarter was $4.8 million, a decrease from $12.5 million in the same quarter of the previous year[25]. - The net loss for the six months ended June 30, 2024, was $9.018 million, slightly improved from a net loss of $9.332 million in the same period of 2023[39]. - Operating activities generated net cash of $70.955 million, a significant recovery from a cash outflow of $19.122 million in the prior year[39]. Revenue Sources - Intellectual property operations generated revenues of $5.3 million, compared to $0.4 million in the prior year, marking a 1,233% increase[25]. - Energy operations contributed $14.2 million in revenues for the quarter, with no prior year comparison as this segment was newly established[25]. - For the three months ended June 30, 2024, paid-up license revenue agreements generated $4,888,000, a significant increase from $75,000 in the same period of 2023[65]. - Recurring License Revenue Agreements for the same period totaled $445,000, up from $319,000 in 2023[65]. - Total license revenues for the three months ended June 30, 2024, reached $5,333,000, compared to $394,000 in 2023, marking a substantial growth[65]. - Printronix's net revenues for the three months ended June 30, 2024, were $6,335,000, down from $7,510,000 in 2023[72]. - For the six months ended June 30, 2024, Printronix reported total revenues of $15,176,000, a decrease from $18,137,000 in the same period of 2023[72]. - Benchmark's total revenue for the three months ended June 30, 2024, was $14,170,000, compared to $16,026,000 in 2023[78]. Assets and Liabilities - Acacia Research Corporation's total liabilities and stockholders' equity stood at $753.6 million as of June 30, 2024, compared to $633.5 million in the previous year[19]. - As of June 30, 2024, cash and cash equivalents increased to $386.988 million from $340.091 million at the beginning of the period, reflecting an increase of $46.897 million[39]. - Total stockholders' equity increased to $335.433 million as of June 30, 2024, up from $269.322 million at the end of 2022[34]. - The company reported a change in fair value of equity securities amounting to $31.445 million, compared to a loss of $9.960 million in the previous year[39]. - The company’s oil and natural gas properties had a net value of $192.6 million as of June 30, 2024, significantly up from $25.1 million as of December 31, 2023[128]. Investments and Acquisitions - The company invested $10 million to acquire a 50.4% equity interest in Benchmark Energy II, LLC, which includes over 13,000 net acres and interests in over 125 wells[50]. - On April 17, 2024, Benchmark completed a transaction to acquire upstream assets in Texas and Oklahoma for $145 million, with the company's contribution being $59.9 million[52]. - The company recognized an asset retirement obligation of $28.8 million as part of the acquisition of oil and gas producing properties[117]. Stock and Shareholder Information - The weighted average number of shares outstanding increased to 100,079,803 from 58,408,711 in the prior year, affecting per share calculations[23]. - Starboard Value, LP holds approximately 60.9% of the common stock, providing access to industry expertise for evaluating acquisition opportunities[45]. - The Board approved a stock repurchase program for up to $20.0 million, with a cap of 5,800,000 shares of common stock[196]. - No stock repurchases occurred under this program for the three and six months ended June 30, 2024[196]. - The 2024 Acacia Research Corporation Stock Incentive Plan reserves 11,168,000 shares for issuance, plus 1,421,848 shares transferred from the 2016 Plan[204]. Expenses and Costs - The company recorded a compensation expense for share-based awards of $1.749 million for the six months ended June 30, 2024, compared to $1.351 million in the same period of 2023[39]. - The total amortization expense for other intangible assets for the six months ended June 30, 2024, was $7.5 million, compared to $6.1 million for the same period in 2023, indicating a year-over-year increase of approximately 22.95%[136]. - The company’s asset retirement obligation as of June 30, 2024, was $29,261,000, with a current portion of $1,543,000[139]. Tax and Legal Matters - The company's effective tax rates were (44)% and (8)% for the three months ended June 30, 2024 and 2023, respectively, and (48)% and 10% for the six months ended June 30, 2024 and 2023, respectively[108]. - As of June 30, 2024, the company had total unrecognized tax benefits of approximately $757,000, which would impact the effective tax rate if recognized[110]. - An accrual of $14.5 million was recorded as of June 30, 2024, related to a dispute involving former executives' profit interests, which will result in a payment in Q3 2024[192]. Miscellaneous - The company has not obtained control of any new patent portfolios during the six months ended June 30, 2024[48]. - The company has made no material payments related to guarantees and indemnities, estimating the fair value of its obligations to be immaterial[193]. - The lease for the New York office was amended to extend the term for Unit 601 for 40 months commencing on April 1, 2024, with annual rent increases[181].

Revenue Growth - Consolidated revenue for Q2 2024 was $25.8 million, representing a 227% increase compared to $7.9 million in Q2 2023[4] - Total revenues for the first six months of 2024 reached $50.2 million, up 121% from $22.7 million in the same period of 2023[3] - Total revenues for Q2 2024 reached $25,838,000, a significant increase from $7,904,000 in Q2 2023, representing a growth of 227% year-over-year[20] - Intellectual property operations generated revenues of $5,333,000 in Q2 2024, compared to $394,000 in Q2 2023, marking a growth of 1,253%[20] - Energy operations contributed $14,170,000 in revenues for Q2 2024, with no revenues reported in Q2 2023[20] - Benchmark generated approximately $14.2 million in revenue during Q2 2024, contributing significantly to the overall revenue growth[5] Financial Performance - Acacia recorded a GAAP net loss of $8.4 million, or $0.08 diluted net loss per share, for Q2 2024, an improvement from a net loss of $18.8 million, or $0.36 per share, in Q2 2023[7] - The company reported a net loss attributable to Acacia Research Corporation of $8,446,000 for Q2 2024, an improvement from a net loss of $18,779,000 in Q2 2023[25] - Adjusted EBITDA for Q2 2024 was $4.1 million, with a total of $10.4 million for the first half of 2024[4] - Adjusted EBITDA for Q2 2024 was $4,091,000, compared to $6,332,000 in Q1 2024, indicating a decrease in operational performance[28] - Excluding the impact of a $12.9 million accrual related to the AIP Matter, the diluted net loss per share for Q2 2024 would have been $0.02[8] Assets and Liabilities - Cash, cash equivalents, and equity investments measured at fair value totaled $405.2 million at June 30, 2024, compared to $403.2 million at December 31, 2023[10] - Total current assets decreased to $493,934,000 as of June 30, 2024, down from $554,512,000 at the end of 2023[18] - The company’s total liabilities increased significantly to $156,848,000 as of June 30, 2024, compared to $43,936,000 at the end of 2023[18] - Cash and cash equivalents rose to $386,988,000 as of June 30, 2024, up from $340,091,000 at the end of 2023[18] Costs and Expenses - The company incurred total costs and expenses of $30,596,000 in Q2 2024, compared to $20,433,000 in Q2 2023, reflecting a 50% increase[21] Shareholder Information - The company's book value per share increased to $5.95 as of June 30, 2024, compared to $5.90 at December 31, 2023[4] - The weighted average number of shares outstanding increased to 100,079,803 in Q2 2024, compared to 58,408,711 in Q2 2023, indicating a dilution effect on earnings per share[26] Acquisitions - The acquisition of upstream assets in Texas and Oklahoma added approximately 470 operated producing wells and expanded Benchmark's portfolio by about 140,000 net acres[5]

Group 1: Inseego (INSG) - Inseego leads in 5G and IoT solutions, achieving a non-GAAP gross margin of 38.7% in Q1 2024, marking one of its highest levels in seven quarters due to favorable product mix and operational efficiencies [3][4] - The company reported $12.3 million in cash as of Q1, a significant increase from the previous year, and terminated its Asset-Based Lending arrangement, enhancing liquidity and reducing interest costs [4] - Inseego's strategic focus on capital optimization and cost reduction positions it as a strong candidate for growth and profitability [4] Group 2: Oscar Health (OSCR) - Oscar Health, a technology-driven health insurance company, reported $177.4 million in net profits for Q1 2024, a $217.1 million increase year-over-year [6][7] - The company achieved an adjusted EBITDA of $219.3 million, reflecting a year-over-year rise of $168.2 million, indicating strong financial stability [6] - Oscar's selling, general, and administrative expenditure ratio decreased by 8.7% to 18.4%, while its medical loss ratio increased by 2.1% to 74.2%, showcasing effective management of healthcare expenses [7] Group 3: Acacia Research (ACTG) - Acacia Research reported an EPS of 6 cents in Q1 2024, indicating potential profitability after non-recurring costs, with an operating loss improvement from $9.3 million in Q1 2023 to $2.1 million [8][9] - The company held over $400 million in cash and marketable securities as of Q1, providing flexibility for expansion opportunities [9] - Acacia Research maintains a cautious debt profile with total non-recourse debt at $13.0 million and a sound balance sheet structure, highlighted by a $28.6 million realized gain from the sale of Arix Bioscience [9]

Core Insights - Stocks priced between $5 and $10 are generally more stable and have shown significant growth, with all discussed stocks returning 10% or more in 2024 and achieving revenue growth of 20% or more in their latest earnings reports [1] Payoneer Global (PAYO) - Payoneer Global is a fintech company serving small and medium enterprises, reporting a 19% revenue increase in Q1 2024, with record revenues of $162.9 million driven by a 21% volume increase [2][3] - Net income surged by 265% year-over-year to $29 million, with consensus expectations suggesting potential returns of 20% to 50% in the next 12 months [3] Arcutis Biotherapeutics (ARQT) - Arcutis Biotherapeutics has seen revenues grow from $2.8 million to $21.6 million in Q1 2024, with its Zoryve treatment contributing $15 million [5] - The company plans to submit documents for its psoriasis treatment, Arrector, to the FDA in Q3 2024 following a successful Phase 3 trial [5][6] Nyxoah (NYXH) - Nyxoah specializes in sleep apnea treatment devices, with revenues increasing nearly 200% in Q1 2024 [7] - The company anticipates FDA approval for its device by the end of 2024, which could significantly boost share prices [8] Redwire Corporation (RDW) - Redwire Corporation has provided nearly 80% returns in 2024, with Q1 sales growing by nearly 53% to $87.8 million [10][11] - The company has become free cash flow positive, indicating potential for future profitability [11] Delcath Systems (DCTH) - Delcath Systems reported a revenue increase from $600,000 to $3.1 million in Q1 2024, with $2 million from its FDA-approved Hepzato Kit [12] - The company has increased its expected number of activated U.S. treatment centers from 15 to 20 for 2024 [12][13] Rush Street Interactive (RSI) - Rush Street Interactive's stock has more than doubled in 2024, with revenues growing by 34% to $217 million [15] - The company revised its EBITDA guidance upward by 38%, indicating a potential path to net income in the near future [15] Acacia Research (ACTG) - Acacia Research's revenues grew from $14.8 million to $24.3 million in Q1 2024, with its intellectual property segment driving significant growth [16] - The company has expanded its upstream oil assets, purchasing 140,000 acres, positioning itself interestingly within the oil industry narrative [17]

Core Viewpoint - Acacia Research (NASDAQ: ACTG) is a business development company focusing on acquiring, managing, and selling small to mid-sized companies across various sectors, including industrial, energy, technology, and healthcare [3][4]. Business Overview - Acacia Research is primarily owned (61%) by Starboard Value LP, an investment adviser [3]. - The company operates in three main business lines: patent licensing, industrial operations, and energy operations [3][4]. - Recent acquisition includes a 50.4% stake in Benchmark Energy II, an independent oil and gas company [4]. Financial Performance - For the most recent earnings release, revenues from the three business lines are as follows: - Intellectual property operations: $13.6 million in 2024 (up from $4.2 million in 2023) - Industrial operations: $8.8 million in 2024 (down from $10.6 million in 2023) - Energy operations: $1.9 million in 2024 (newly reported) [5]. - Patent licensing is the largest revenue source, but growth may not continue as no new patent portfolios were purchased in the recent quarter [5][6]. Cash Position - The company has $438 million in cash and cash equivalents, equating to $4.38 per share, which is approximately 79% of the current share price of $5.55 [9]. - Remaining current assets of about $114 million exceed total liabilities, indicating a strong cash position [9]. Valuation Metrics - Acacia Research has an overall A- valuation grade, with strong enterprise value metrics [11]. - Key valuation metrics include: - EV / Sales (TTM): 0.70 (A grade) - EV / EBITDA (TTM): 2.07 (A+ grade) - Price / Book (TTM): 0.98 (B grade) [12]. Investment Considerations - The company’s performance is characterized by high variability due to its business model, making future performance difficult to forecast [5][16]. - Despite the risks, the significant cash position provides a buffer against potential downturns, leading to a cautious but optimistic investment outlook [16].

Core Insights - The article highlights three stocks under $5 that present significant investment opportunities in the gold industry, healthcare technology, and specialty finance sectors [1][2]. Group 1: Acacia (ACTG) - Acacia's oil and gas subsidiary, Benchmark, has expanded its portfolio through a significant acquisition in Texas and Oklahoma, which is expected to generate approximately $50 million in asset-level cash flow in 2024 [3][4]. - Total sales for Acacia increased from $14.8 million to $24.3 million in Q1 2024, with a notable rise in licensing and other revenue from the intellectual property sector [4]. - Acacia has eliminated non-recourse debt at Benchmark and paid off senior secured notes, resulting in a debt-free parent company and a healthier financial position [4]. Group 2: CareCloud (CCLD) - CareCloud has reduced yearly expenditures by nearly $22 million since October 2023, leading to a Q1 2024 GAAP operational gain of $129,000, a significant improvement from a loss of $223,000 in Q1 2023 [5]. - The company's Q1 2024 GAAP net loss decreased to $241,000 from $401,000, and it reported an adjusted EBITDA of $3.7 million [5]. - CareCloud's free cash flow in Q1 2024 was $2.2 million, up from $2.0 million in Q1 2023, allowing for a reduction in debt commitments [6]. Group 3: New Gold (NGD) - New Gold generated substantial cash from operations amounting to $73 million in Q1 2024, despite reduced sales compared to Q1 2023, maintaining $530 million in total liquidity and $157 million in cash [7]. - The company invested over $35 million in growth capital during Q1, focusing on development initiatives to increase production capacity [7]. - New Gold's safety statistics indicate a commitment to responsible mining, with a total recordable injury frequency rate (TRIFR) of 0.92 in Q1 [8].