InterDigital Inc (NASDAQ:IDCC) Fits Minervini’s Trend Framework with Strong Momentum and Growth

InterDigital Inc (NASDAQ:IDCC): A Strong Momentum Stock Aligning with Minervini’s Trend Framework

Mark Minervini’s trend-based strategy identifies stocks with solid technical and fundamental traits, ensuring they are in a clear upward trend (Stage 2) while showing faster earnings and revenue growth. The method blends strict technical checks, using moving averages, relative strength, and price movement, with fundamental filters to find strong momentum stocks. InterDigital Inc (IDCC) stands out as a strong candidate, fitting both the technical rules of Minervini’s Trend Framework and the high-growth momentum (HGM) criteria.

How IDCC Matches the Minervini Trend Framework

The Trend Framework highlights stocks in a steady upward trend, confirmed by key moving averages and price strength. IDCC meets these standards:

• Price Above Key Moving Averages:

  • Current price ($268.74) is higher than the 50-day SMA ($236.07), 150-day SMA ($214.64), and 200-day SMA ($207.59).
  • The 50-day SMA is above the 150-day and 200-day SMAs, a positive setup.
  • Both the 150-day and 200-day SMAs are rising, confirming long-term stability.

• High Relative Strength:

  • IDCC’s relative strength (RS) score is 93.96, meaning it beats 94% of all stocks—a sign of market leadership.

• Price Performance vs. 52-Week Range:

  • The stock is trading 30% above its 52-week low ($129.76) and within 3.3% of its 52-week high ($277.95), showing continued momentum.

These metrics fit Minervini’s view that top-performing stocks stay strong across multiple timeframes and lead their sector.

High-Growth Momentum Fundamentals

Beyond technicals, IDCC shows faster growth, a core part of Minervini’s SEPA (Specific Entry Point Analysis) method:

• Earnings Growth:

  • TTM EPS growth: +41.1% YoY.
  • Quarterly EPS growth (Q2Q): +36.1% (latest quarter), with past quarters showing +19.8% and +190.1% growth.
  • 3-year EPS growth: +60.5% (FY), +114.9% (FY-1), and +66.2% (FY-2), reflecting steady expansion.

• Revenue Growth:

  • TTM revenue growth: +21.8% YoY.
  • Latest quarterly revenue growth: +34.5%, with past quarters showing +139.6% and -8.2% (volatility due to licensing cycles).

• Profit Margins:

  • Latest quarter profit margin: 60.07%, up from 54.9% in the prior quarter, showing better efficiency.

• Analyst Revisions:

  • Next-year EPS estimates raised by 10.4% over the past three months, reflecting improved sentiment.

These fundamentals suggest IDCC is not just technically sound but also benefiting from operational gains and market demand for its wireless and video technology IP.

Potential for a Technical Breakout

According to ChartMill’s technical analysis report:

• Technical Rating: 10/10—showing outstanding trend strength.
• Setup Rating: 6/10—indicating a consolidation phase with lower volatility, often before a breakout.
• Key Support/Resistance:
  • Support at $264.20 (horizontal) and $228.61–$231.90 (multi-timeframe trendlines).
  • Resistance at $276.12, a move above which could signal more upside.

Read the full technical report here.

Final Thoughts

InterDigital Inc (IDCC) makes a strong case for high-growth momentum investors, fitting Minervini’s strategy by combining a solid technical uptrend with faster earnings and revenue growth. The stock’s high relative strength, rising moving averages, and better fundamentals make it worth further study.

For more high-growth momentum stocks matching the Minervini Trend Framework, check our predefined screen here.

Disclaimer: This analysis is for informational purposes only and does not constitute investment advice. Always conduct your own research and consider risk management principles before trading.