Value
7.0/10data confidence 40%| Component | Sub-score |
|---|---|
| P/S | 9.3 |
| EV/EBITDA | 4.6 |
ACTG · Why this verdict
Why Acacia Research (ACTG) is rated SELL
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results. How we score · Editorial policy
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VerdictSELL
Overall score5.8/10
ConfidenceMEDIUM
MacroNEUTRAL
TrendMatrix Research · core thesis
Engine thesis — one sentence
Acacia Research has beaten earnings in 4 straight quarters, grown revenue 124% YoY and trades 21.1% below the $5.10 analyst target, but quality is below the minimum floor, free cash flow is negative, and revenue and earnings have been highly lumpy.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
Acacia has beaten EPS estimates in each of the last 4 quarters, turning to a $0.13 profit in August 2026 against a -$0.09 estimate. Avg surprise pct | EPS stays positive and above estimates in the November 5 report and the following quarters. | →Stable |
| CounterEarlier history includes large misses (-891% in November 2024, -154.57% in March 2025), so the streak may be a run of low estimates rather than durable earnings. | ||
Growth is strong at 124% YoY, with June 2026 quarter revenue of $114.6M versus $51.2M a year earlier. Growth breakdown | Quarterly revenue stays above $50M despite lumpy timing. | →Stable |
| CounterRevenue is lumpy, with March 2025 at $124.4M followed by quarters near $50M, and the next-quarter estimate of $45.5M is far below the June figure. | ||
Insider selling is minor at $457,560 (0.111% of market cap) across 5 sales, not a sign that insiders are abandoning the stock. Net value 90d | Net insider selling stays below 0.2% of market cap over the next 12 months. | ↓Deteriorating |
| CounterFive sales and zero buys flag a bearish signal, and two high-severity concentration risks (Anadarko Basin and Starboard Value LP) add to risk. | ||
At $4.21 the stock is 21.1% below the $5.10 analyst target, with reward-to-risk of 4.2. Analyst target | Price moves toward the $5.10 target as earnings beats continue. | ↓Deteriorating |
| CounterQuality is below the 4.0 floor at 2.7 and free cash flow is -6% of revenue, so the upside depends on continued beats rather than cash generation. | ||
The stock is below its 200-day average, but that average is rising 2.0% over 30 days and on-balance volume shows accumulation. Momentum breakdown | Price reclaims the 200-day average with volume support. | ↑Improving |
| CounterMomentum of 6.0/10 is only moderate, and beta scores 10.0 on risk, meaning a sharp swing either way is likely. | ||
Acacia has beaten EPS estimates in each of the last 4 quarters, turning to a $0.13 profit in August 2026 against a -$0.09 estimate.
→StableAvg surprise pct
- Expectation
- EPS stays positive and above estimates in the November 5 report and the following quarters.
CounterEarlier history includes large misses (-891% in November 2024, -154.57% in March 2025), so the streak may be a run of low estimates rather than durable earnings.
Growth is strong at 124% YoY, with June 2026 quarter revenue of $114.6M versus $51.2M a year earlier.
→StableGrowth breakdown
- Expectation
- Quarterly revenue stays above $50M despite lumpy timing.
CounterRevenue is lumpy, with March 2025 at $124.4M followed by quarters near $50M, and the next-quarter estimate of $45.5M is far below the June figure.
Insider selling is minor at $457,560 (0.111% of market cap) across 5 sales, not a sign that insiders are abandoning the stock.
↓DeterioratingNet value 90d
- Expectation
- Net insider selling stays below 0.2% of market cap over the next 12 months.
CounterFive sales and zero buys flag a bearish signal, and two high-severity concentration risks (Anadarko Basin and Starboard Value LP) add to risk.
At $4.21 the stock is 21.1% below the $5.10 analyst target, with reward-to-risk of 4.2.
↓DeterioratingAnalyst target
- Expectation
- Price moves toward the $5.10 target as earnings beats continue.
CounterQuality is below the 4.0 floor at 2.7 and free cash flow is -6% of revenue, so the upside depends on continued beats rather than cash generation.
The stock is below its 200-day average, but that average is rising 2.0% over 30 days and on-balance volume shows accumulation.
↑ImprovingMomentum breakdown
- Expectation
- Price reclaims the 200-day average with volume support.
CounterMomentum of 6.0/10 is only moderate, and beta scores 10.0 on risk, meaning a sharp swing either way is likely.
Per-dimension breakdown
Quality
2.7/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 0.0 |
| ROA | 0.0 |
| Gross margin | 0.4 |
| Op margin | 3.0 |
| Net margin | 0.0 |
| Current ratio | 8.2 |
| FCF quality | 0.0 |
| Moat | 5.8 |
| Piotroski F | 6.7 |
- ▸Cash-burning: FCF -6% of revenue
- ▸Quality concerns
Growth
10.0/10data confidence 33%| Component | Sub-score |
|---|---|
| Rev growth | 10.0 |
- ▸Strong growth: 124% YoY
Momentum
6.8/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 4.5 |
| MACD | 6.3 |
| OBV | 10.0 |
| MA position | 7.2 |
| Volume | 5.8 |
- ▸Volume accumulation (rising OBV)
- ▸Below 200-MA but MA still rising (+1.9%/30d) — pullback in uptrend, not confirmed weakness
Sentiment
6.3/10data confidence 100%| Component | Sub-score |
|---|---|
| Analyst rating | 5.0 |
| Price target | 9.0 |
| erm sentiment | 5.0 |
- ▸Analyst upside: 36%
Insider
3.5/10data confidence 75%| Component | Sub-score |
|---|---|
| materiality | 3.0 |
| insider conviction | 2.0 |
| holder change | 5.4 |
- ▸Notable insider selling — $457,560 (0.107% of mkt cap)
Peer rank
4.2/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 3.3 |
| quality rank | 0.0 |
| growth rank | 6.7 |
Technical
3.1/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 1.6 |
| support resistance | 1.0 |
| 52w position | 6.7 |
Risk (lower is worse)
6.1/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 7.7 |
| days to cover | 0.6 |
| volatility | 6.0 |
| put call | 6.7 |
| implied vol | 2.4 |
| beta | 10.0 |
| debt equity | 9.3 |
- ▸High IV: 66%
- ▸Concentration risks: 2 HIGH (10-K Item 1A — sized via position_sizing, validated via buy_confidence)
Catalyst
7.5/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 5.0 |
| earnings history | 10.0 |
| earnings timing | 5.0 |
| surprise avg | 10.0 |
- ▸Perfect beat streak: 4Q
- ▸Earnings in 6 days
How the verdict was assembled
Engine trigger
Quality below minimum threshold.
Engine technical detail
verdict_path:
L1:HARD_BLOCK:QUALITY_FLOORPassed (7)
- MOMENTUM:6.8>=5.5
- ASYMMETRY:2.5>=1.5
- INSIDER:OK
- 8K:CLEAN
- NEWS_EVENTS:NONE_RECENT
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (1)
- EARNINGS_PROXIMITY:6d<=7d
Warning (0)
none
Reward-to-Risk
2.50
Upside
+15.9%
Downside
6.4%
Sizing output
AVOID
Setup— — No clear chart pattern; technical signals are mixed
EdgeNo clear edge — No clear edge identified
SuitabilityAggressive — MCap $0.4B<$5B
Investment implication
The SELL_IF_HOLDING verdict reflects the EARNINGS_PROXIMITY gate's 6d<=7d outcome against Growth at 10.0 and asymmetric R:R of 2.50.
The strongest dimensions are Growth at 10.0, Catalyst at 7.5, and Value at 7.0; the weakest are Quality at 2.7, Technical at 3.1, and Insider at 3.5. The V9 engine flagged 1 failed gate, producing an asymmetric reward-to-risk of 2.50 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1Perfect Earnings Beat Streak
Trip ifEPS surprise stays below 0% for 2 consecutive quarters.
- P2Revenue Growth Surge
Trip ifQuarterly revenue falls below $45M from $114.6M in the June 2026 quarter.
- P3Limited Insider Selling
Trip ifNet insider selling exceeds 0.5% of market cap over a 90-day window.
- P4Analyst Target Upside
Trip ifAnalyst target falls below $4.50 from the current $5.10.
- P5Pullback In Rising Trend
Trip ifPrice falls below the $4.01 stop level, more than 4% under the current $4.21.