📊 ACTG Key Takeaways
Is Acacia Research Corp. (ACTG) a Good Investment?
ACTG demonstrates exceptional revenue growth (+133.2% YoY) and strong free cash flow generation ($73.2M, 25.6% FCF margin), supported by substantial cash reserves ($306.7M). However, profitability metrics remain concerning with minimal operating margins (2.2%), weak interest coverage (0.7x), and low returns on assets (2.8%), suggesting the revenue growth has not translated into sustainable earnings or operational efficiency.
Acacia Research shows strong top-line momentum and excellent cash generation, with revenue up 133.2% YoY and free cash flow of $73.15M supported by a very liquid balance sheet. However, growth quality is mixed because operating margin remains thin at 2.2%, net income was flat YoY, and weak interest coverage suggests limited earnings cushion if operating performance softens.
Why Buy Acacia Research Corp. Stock? ACTG Key Strengths
- Exceptional revenue growth of 133.2% year-over-year demonstrating strong business momentum
- Robust free cash flow generation at $73.2M with 25.6% FCF margin indicating excellent cash conversion
- Fortress balance sheet with $306.7M cash, low debt-to-equity ratio (0.17x), and exceptional liquidity (9.18x current ratio)
- Strong net income at $21.7M with 161.1% EPS growth supporting bottom-line expansion
- Very strong liquidity, with $306.72M in cash and current ratio of 9.18x
- Revenue growth accelerated sharply, indicating meaningful business expansion
- Free cash flow is strong at $73.15M with a 25.6% FCF margin
ACTG Stock Risks: Acacia Research Corp. Investment Risks
- Critically low interest coverage ratio of 0.7x indicates insufficient operating income to service debt obligations, creating financial stress
- Anemic operating margins at 2.2% and net margins at 7.6% suggest poor operational leverage and cost structure challenges despite significant revenue scale
- Minimal return metrics (ROE 4.0%, ROA 2.8%) indicate capital is not being deployed efficiently, raising questions about revenue quality and asset productivity
- Patent licensing business model inherently vulnerable to litigation outcomes and regulatory changes affecting intellectual property enforcement
- Operating profitability is weak, with only a 2.2% operating margin despite large revenue growth
- Interest coverage of 0.7x indicates limited ability to cover financing costs from operating income
- Net income was flat YoY, suggesting revenue growth is not fully translating into bottom-line improvement
Key Metrics to Watch
- Operating margin trend - critical to validate whether 133% revenue growth can sustainably improve operational efficiency
- Interest coverage ratio - must improve above 1.5x to ensure debt sustainability without financial distress
- Free cash flow stability - monitor whether current $73.2M FCF level can be maintained as growth moderates
- Return on equity improvement trajectory - current 4.0% ROE is unsustainable for long-term shareholder value creation
- Operating margin and interest coverage
- Net income conversion from revenue growth and free cash flow consistency
Acacia Research Corp. (ACTG) Financial Metrics & Key Ratios
💡 AI Analyst Insight
The 25.6% free cash flow margin provides substantial flexibility for dividends, buybacks, and strategic investments. Strong liquidity with a 9.18x current ratio provides a solid financial cushion.
ACTG Profit Margin, ROE & Profitability Analysis
ACTG vs Market Sector: How Acacia Research Corp. Compares
How Acacia Research Corp. compares to Market sector averages
Sector benchmarks are approximate industry averages. Actual sector performance may vary.
Is Acacia Research Corp. Stock Overvalued? ACTG Valuation Analysis 2026
Based on fundamental analysis, Acacia Research Corp. has mixed fundamental signals relative to the Market sector in 2026.
Note: This is a fundamental analysis based on SEC filings. For P/E ratio, price targets, and market-based valuation, consult financial data providers. This is not investment advice.
Acacia Research Corp. Balance Sheet: ACTG Debt, Cash & Liquidity
ACTG Revenue & Earnings Growth: 5-Year Financial Trend
5-Year Trend Summary: Acacia Research Corp.'s revenue has grown significantly by 224% over the 5-year period, indicating strong business expansion. The most recent EPS of $-0.36 indicates the company is currently unprofitable.
ACTG Revenue Growth, EPS Growth & YoY Performance
ACTG Quarterly Earnings & Performance
| Quarter | Revenue | Net Income | EPS |
|---|---|---|---|
| Q3 2025 | $23.3M | -$2.7M | $-0.03 |
| Q2 2025 | $25.8M | -$3.3M | $-0.03 |
| Q1 2025 | $24.3M | -$186.0K | $0.00 |
| Q3 2024 | $10.1M | $1.6M | $-0.03 |
| Q2 2024 | $7.9M | -$8.4M | $-0.08 |
| Q1 2024 | $14.8M | -$186.0K | $0.00 |
| Q3 2023 | $10.1M | $1.6M | $0.02 |
| Q2 2023 | $7.9M | -$9.3M | $-0.26 |
Data sourced from SEC EDGAR 10-Q quarterly filings. Figures may represent quarterly or cumulative values.
Acacia Research Corp. Dividends, Buybacks & Capital Allocation
ACTG SEC Filings: Latest 10-K & 10-Q Analysis
Access official SEC EDGAR filings for Acacia Research Corp. (CIK: 0000934549)
📋 Recent SEC Filings
❓ Frequently Asked Questions about ACTG
What is the AI rating for ACTG?
Acacia Research Corp. (ACTG) has a Combined AI Rating of HOLD from Claude (HOLD) and ChatGPT (HOLD) with 69% combined confidence, based on fundamental analysis of SEC EDGAR filings.
What are ACTG's key strengths?
Claude: Exceptional revenue growth of 133.2% year-over-year demonstrating strong business momentum. Robust free cash flow generation at $73.2M with 25.6% FCF margin indicating excellent cash conversion. ChatGPT: Very strong liquidity, with $306.72M in cash and current ratio of 9.18x. Revenue growth accelerated sharply, indicating meaningful business expansion.
What are the risks of investing in ACTG?
Claude: Critically low interest coverage ratio of 0.7x indicates insufficient operating income to service debt obligations, creating financial stress. Anemic operating margins at 2.2% and net margins at 7.6% suggest poor operational leverage and cost structure challenges despite significant revenue scale. ChatGPT: Operating profitability is weak, with only a 2.2% operating margin despite large revenue growth. Interest coverage of 0.7x indicates limited ability to cover financing costs from operating income.
What is ACTG's revenue and growth?
Acacia Research Corp. reported revenue of $285.2M.
Does ACTG pay dividends?
Acacia Research Corp. does not currently pay dividends.
Where can I find ACTG SEC filings?
Official SEC filings for Acacia Research Corp. (CIK: 0000934549) including 10-K, 10-Q, and 8-K reports are available on SEC EDGAR.
What is ACTG's EPS?
Acacia Research Corp. has a diluted EPS of $0.22.
How is the AI analysis conducted?
Two independent AI systems — Claude (Anthropic) and ChatGPT (OpenAI) — analyze SEC EDGAR filings including 10-K annual reports and 10-Q quarterly reports. Each AI evaluates financial health, profitability ratios, balance sheet strength, and growth metrics. The combined rating reflects both perspectives for balanced insights.
Is ACTG a good stock to buy right now?
Based on our AI fundamental analysis in April 2026, Acacia Research Corp. has a HOLD rating with 69% confidence. Review the strengths and risks sections above before making a decision. This is not investment advice.
Is ACTG stock overvalued or undervalued?
Valuation metrics for ACTG: ROE of 4.0% (sector avg: 15%), net margin of 7.6% (sector avg: 12%). Compare these metrics with sector averages to assess valuation.
Should I buy ACTG stock in 2026?
Our dual AI analysis gives Acacia Research Corp. a combined HOLD rating for 2026. Revenue is data pending, with profitability at or below sector average. Always conduct your own research.
What is ACTG's free cash flow?
Acacia Research Corp.'s operating cash flow is $75.2M, with capital expenditures of $2.1M. FCF margin is 25.6%.
How does ACTG compare to other Market stocks?
Vs Default sector averages: Net margin 7.6% (avg: 12%), ROE 4.0% (avg: 15%), current ratio 9.18 (avg: 1.8).