EPR Properties (EPR), Core Laboratories N.V. (CLB): Pay Attention to These Top Holdings of Columbia Partners

A leader in patent licensing

Acacia Research Corporation (NASDAQ:ACTG) enters into licensing agreements with various companies, which seek protection from patent claims. Under such licensing agreements, Acacia partners with the patent owners and then seeks to license patents to corporate users. The revenue generated is shared between Acacia and the original patent owner depending on the covenant of the agreement.

Recently, Acacia, through its subsidiaries, entered into such agreement with Citigroup Inc. (NYSE:C), RPX Corp (NASDAQ:RPXC), Target Corporation (NYSE:TGT), and Rite Aid Corporation (NYSE:RAD). These agreements are expected to generate average revenue of $20 million-$40 million each during the life of the agreement.

Acacia, being one of the most active patent dealers in the U.S., is amassing patents in technologies, automobile, and energy. These sectors provide significant revenue opportunity for Acacia because of the vast area that these sectors cover. Also, the company is experiencing an increase in demand for its services because of the diversified portfolio of patents it holds.

Acacia’s patent holdings have grown at a CAGR of 28% over the last four years and are expected to continue their momentum this year. Thus, Acacia will generate revenue of $257 million in 2013 and $335 million in 2014, up from $250 million in 2012.

Conclusion

The revenue of Core Laboratories N.V. (NYSE:CLB) should see a rise in 2013 and 2014 due to its increasing engagements in deepwater hydrocarbons and international crude oil well development. Also, its continuous effort to distribute the profits to its shareholders makes it a certain buy.

The intention of acquiring a company that owns 11 theater properties will provide a platform for Acacia to generate higher revenue in the future. However, the problems related to Imagine Schools may force Acacia’s profit margin to decline in the current year. Therefore, I recommend investors to keep a cautious watch and hold this stock for the time being.

Acacia is expanding its footprint in patent licensing by entering into the technology, automobile, and energy patent markets. This will help Acacia generate higher revenue in 2013 and 2014. Thus, I recommend a buy on this stock.

Madhu Dube has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned.

The article Pay Attention to These Top Holdings of Columbia Partners originally appeared on Fool.com and is written by Madhu Dube.

Madhu is a member of The Motley Fool Blog Network — entries represent the personal opinion of the blogger and are not formally edited.

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