Shares of Voip-Pal.Com Inc (OTCMKTS: VPLM) have been on a downward spiral ever since the company lost a patent infringement claims case against tech giants Apple Inc. (NASDAQ: AAPL), AT&T Inc. (NASDAQ: T) and Verizon Communications Inc. (NASDAQ: VZ). Just as was the case in the first quarter of the year the stock has resorted to trading in a downtrend, amidst concerns of soaring short selling pressure.
Voip-Pal.Com Price Analysis
The stock is already down by more than 60% for the year in continuation of a bearish trend that began early last year. After a recent plunge lower, the stock appears to have found strong support at the $0.02 level from where it is trying to bounce back.
Any bounce back from current lows will have to contend with strong resistance at the $0.05 level from where the stock began its current leg down. Voip-Pal.com needs to rise and stabilize above the $0.05 technical level, to avert further slides.
Above the $0.05 mark, the stock would be well positioned to make a run for the $0.10 mark above which Voip-Pal.com is poised to turn bullish. Below the $0.05 mark, Voip-Pal.com remains susceptible to further drops given the underlying long-term bear trend.
Voip-Pal.com is a publicly traded company that owns a portfolio of Voice-over-internet Protocol VoIP technology. The company offers VoIP-related patented technology for routing, billing, rating and advanced interoperability solutions.
Voip-Pal.Com Takeover Push
Voip-Pal.com has continued to trade sideways after the recent implosion even on emerging it is an acquisition target. The company’s board of directors has rejected a formal takeover offer by Dr. Gil Amelio and his associates.
The takeover push involved the acquisition of stock owned by CEO, Emil Malak. The tabled offer valued the shares owned by the CEO at $150 million. While rejecting the takeover offer the board insists it is still opened to further discussions with Dr. Amelio and his associates.
The board has also confirmed that it is opened to selling all of Voip-Pal.com shares on behalf of the more than 4,500 shareholders.
“We have great respect for Dr. Gil Amelio and his team, and we are very pleased to know they see such value in our patents or they would not have tendered this offer. We are currently focused on our legal appeal to the recent Alice 101 decision as well as finalizing our strategy to move forward in Europe. In the meantime, we are working diligently to add to our patent portfolio with patent continuation applications. Patience is a virtue,” stated CEO Emil Malak, VoIP-Pal.
Patent Infringement Appeal
Even as Voip-Pal.com continues with discussions that could lead to potential takeover, it has confirmed plans to appeal a recent decision on the ‘Alice 101 Motion’. The U.S District Court dismissed patent infringement claims and invalidated Voip-Pal.com‘s patents as part of the ruling.
According to the ruling, the company’s claims of infringement did not hold any water as they touched on an abstract idea of routing phone calls. While accepting the ruling, the company’s says it will lodge an appeal in the U.S even as it prepares lodging complaints in other jurisdiction.
“We are also in consultation with our attorneys in Europe regarding the process of preparing complaints in Germany. As we have previously stated, there are about 770 million mobile subscribers in Europe, which makes our European patents a very strong addition to our portfolio,” stated CEO Malak.
Voip-Pal.com has lost a significant amount of market value over the past year, investors sentiments in the stock having hit an all-time low. With the stock engulfed in a long-term bear trend things are not looking good, given the soaring short selling pressure.
While the underperformance of the past year is a point of concern, the company has tremendous potential. The fact that the company is an acquisition target essentially means it has the potential to generate significant value and validate its long-term prospects.
For investors eyeing opportunities in the company, it would be wise to wait for the stock to rise and find support above the $0.05 resistance level. Given the uncertainty around the infringement claims appeal process as well as the takeover bid, below the $0.05 mark, Voip-Pal.com remains vulnerable.
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Disclosure: We have no position in VPLM and have not been compensated for this article.