Patent deal will help cellphone spinoff

Article Excerpt

MOTOROLA INC. $7.30 (New York symbol MOT; Conservative Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 2.3 billion; Market cap: $16.8 billion; Price-to-sales ratio: 0.8; No dividends paid since January 2009; WSSF Rating: Average) has settled a three-year-long patent dispute with Research in Motion Ltd. (Nasdaq symbol RIMM). Research in Motion makes the popular BlackBerry smartphone. Research in Motion will pay Motorola an undisclosed sum, as well as regular royalties related to certain wireless technologies. The two companies also agreed to drop all outstanding lawsuits. Setting this dispute improves the prospects for Motorola’s cellphone business, which it plans to spin off as a separate company next year. However, this business is still losing money. It also faces increasing competition from other smartphones, including Apple’s iPhone and the BlackBerry. Motorola is still a hold. hold…