The last time I took a good look at Qualcomm, Inc. (NASDAQ:QCOM), I said it was a buy if you believe in the economy. Since then, the QCOM stock is down close to 1% while the broader market is up almost 2%.

QCOM shares are down because the storm I described back then has grown to hurricane strength. That storm is its dispute with Apple Inc. (NASDAQ:AAPL) over royalty rights, which a judge has now denied Qualcomm’s motions for preliminary injunctions.

The patents are called essential to standards and, under U.S. law, Qualcomm is required to offer them on “fair, reasonable and non-discriminatory” (FRAND) terms. QCOM says only some of the patents are subject to FRAND and that it is free to price other rights however it wants.

Worse, hedge fund titan Paul Singer’s Elliott Management Corporation is backing a move to renegotiate QCOM’s pending merger with NXP Semiconductor NV (NASDAQ:NXPI) seeking a higher price. The move is essential to Qualcomm’s diversification efforts.

Tapping a Horde

Qualcomm has been playing a risky game with its patents for years, forcing even government-backed efforts in China and Korea to back down and negotiate terms favorable to it. But Apple, which basically wants a quantity discount, has a market cap of more than $800 billion, against Qualcomm’s $75 billion, and has managed to get the U.S. government on its side.

Once the Apple suit is settled, Qualcomm will expect a big check for past royalty payments Apple is now withholding. This is one reason why Qualcomm calls the stock perfect for patient investors. It’s like a coiled spring that will quickly grow larger when the tension on it is released.

But the tension is not being released. In fact, with the Elliott move against the NXPI merger, the tension is now growing. As a result QCOM stock is now trading about 20 times last year’s earnings, which is very low for a tech stock with key interests in mobility and the Internet of Things.

To relieve the tension, Qualcomm has taken to stunts like boosting Alphabet Inc (NASDAQ:GOOGL) Android designs while Apple was launching the iPhone 8. The merits of the case are irrelevant, since QCOM is supplying both sides. But that, too, is at risk, because a key point in the dispute is Apple’s move to using Intel Corporation (NASDAQ:INTC) modem chips and whether courts will let it save money in doing that.

Proving the Value

The value of Qualcomm’s technology is being proven in the story you are now reading.

When Tropical Storm Irma slammed into Georgia, half the state lost electrical power, including my home-office. This is being written in semi-darkness, with a Qualcomm chip acting as a mobile hotspot, connected to a laptop with a long battery life.

All day yesterday, as I wandered the streets with neighbors, surveying the damage, I saw those people carrying their phones with them, staying in touch with the world with their screens. One guy, whose electricity stayed on, made himself very popular by bringing out a power cord and letting us recharge our phones. The city remained calm because the city remained connected.

The Bottom Line on QCOM Stock

Qualcomm stock is due for greater pain even while its future promise remains bright, in areas like 5G cellular and autonomous cars

There is risk investing in a coiled spring under pressure, risk that the spring may fail, either through the collapse of the NXP deal, as Vince Martin notes, or a big loss in court. Buying Qualcomm here is not without risk.

But I still believe it a risk worth taking.

Dana Blankenhorn http://www.danablankenhorn.com is a financial and technology journalist. He is the author of the historical mystery romance The Reluctant Detective Travels in Time available now at the Amazon Kindle store. Write him at danablankenhorn@gmail.com or follow him on Twitter at @danablankenhorn. As of this writing he does not own any of the aforementioned shares.