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A Less Than Bright Wall Street View of SATS
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Last week, Jason Bazinet of Citi Investment Research initiated coverage of EchoStar (the technology company spun off from the DBS assets) with a "sell" rating and $18 price target. In a note explaining the coverage, the analyst said the rating is based on a lack of free cash, no visibility on new contract wins and other factors.
On the new business side, Bazinet said he sees no near-term set-top-box wins for the company. The analyst said he does not expect U.S. cable firms to use SATS boxes, and that he sees "little opportunity for wins from the digital conversion in early 2009 given non-existent retail distribution."
The company also could be impacted by a lack of satellite business. Fixed satellite services (FSS) revenue from the existing DISH contract will likely decline overtime, Bazinet said.
"While DISH needs new capacity for high-definition, we expect this capacity to be met by DISH's satellites, not SATS's. And we see no evidence of sizable new contract wins from third parties," the analyst said.
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Last week, Jason Bazinet of Citi Investment Research initiated coverage of EchoStar (the technology company spun off from the DBS assets) with a "sell" rating and $18 price target. In a note explaining the coverage, the analyst said the rating is based on a lack of free cash, no visibility on new contract wins and other factors.
On the new business side, Bazinet said he sees no near-term set-top-box wins for the company. The analyst said he does not expect U.S. cable firms to use SATS boxes, and that he sees "little opportunity for wins from the digital conversion in early 2009 given non-existent retail distribution."
The company also could be impacted by a lack of satellite business. Fixed satellite services (FSS) revenue from the existing DISH contract will likely decline overtime, Bazinet said.
"While DISH needs new capacity for high-definition, we expect this capacity to be met by DISH's satellites, not SATS's. And we see no evidence of sizable new contract wins from third parties," the analyst said.
