NQ Mobile Is A Deeply Undervalued Battleground Stock Primed For A Major Move
Disclosure: I am long NQ.
We have previously written about the fundamental case for buying NQ Mobile ("NQ", or "the Company"
, the global smartphone security leader (here and here). As noted in our previous articles, we believe NQ provides long-term investors the opportunity to realize a base case ~3x return on invested capital over the next 12-18 months. The possibility of even further upside is significant as NQ evolves, although our base case does not contemplate that at the moment.
NQ has become the largest pure-play mobile software company by both revenue and earnings in the Greater China region and the most successful Chinese company to expand internationally ever, with the majority of its revenues now coming from outside of China. And yet, as our long-term thesis becomes increasingly validated, the stock price is still far off our base case targets and the valuation remains ridiculously cheap (for a fundamental valuation discussion, we refer readers to our original articles referenced above, since the valuation analysis is still largely accurate). [Read on here]