fields (MASI) Stocks surged Wednesday after US judge ruled apple (AAPL) has infringed two patents protecting Masimo’s blood oxygenation technology.
Masimo manufactures pulse oximeters that measure oxygen levels in the blood. This is an easy way to see how well oxygen is being delivered to your extremities. Apple first introduced a pulse oximeter sensor to the watch in his 2020, and the current iteration uses light-based technology.
The US International Trade Commission is currently considering whether to implement an Apple Watch import ban. Needham analyst Mike Matson says Apple will likely choose to pay Masimo royalties in the settlement agreement.
“Even a modest royalty of $1 to $2 per watch could add $60 million to $120 million to Masimo’s annual revenue, or $82 cents to $1.64 per year (earnings per share). ,” he said in a note to clients.
On the stock market today, Masimo’s share price rose 2.2% to close at 156.76, well off the pre-market pop. Apple stock rose his 2.1% to end the regular session at 133.49.
Masimo Stocks: A Bigger Patent Race Opens Up
Masimo originally took on Apple in June 2021 and asked the International Trade Commission to ban Apple Watch imports from China to the United States, Matson said. The ban could go into effect in May of this year he. President Joe Biden now has 60 days to disapprove of the decision. If Apple loses, the tech giant could appeal.
Masimo’s patent won’t expire until 2028, Matson said. Meanwhile, Apple is expected to sell around 59 million watches in 2023, up from 50 million last year and 40 million in 2021.
Masimo is also suing Apple in the federal court system, alleging that Apple infringed on 10 of its patents. The company also said Apple poached several executives to avoid royalties or cash deals with Masimo, Masimo said.
In an emailed statement to Investor’s Business Daily, Apple said it is seeking a full review by the International Trade Commission.
“Apple’s team works tirelessly to create products and services that provide industry-leading health, wellness and safety features for our users.” “By introducing a device that copies the Apple Watch and infringes our intellectual property, Masimo seeks to capitalize on many of these innovations while also removing competition from the market.”
Masimo Has a “Strong Patent Portfolio”
Matson maintained his Buy rating on Masimo stock. He noted that Masimo has won patent lawsuits against large companies such as: medtronic (MDT) and Phillips (PHG).
“We believe Masimo has built a strong patent portfolio, but we expect the litigation to be many years away.”
The Masimo share has an overall rating of 83, according to IBD Digital. This places us in the top 17% of all stocks in terms of fundamentals and technical indicators.
Follow Allison Gatlin on Twitter. @IBD_AGatlin.
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