DISH Network (DISH): Broadcaster Auction Confusion Creates Buying Opportunity - Jefferies
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Jefferies analyst, Mike McCormack, reiterated his Buy rating on shares of Dish Network (NASDAQ: DISH) and thinks that investors are reading too much into the Broadcaster auction and they should look through the noise and focus on the "dramatically under-valued portfolio of spectrum".
The analyst sees three scenarios. "The first scenario, an auction failure (unlikely in our view) would most certainly be viewed positively for DISH as either demand did not materialize, or the price of low-band spectrum wasn’t sufficient for broadcasters. The next scenario is likely the most misunderstood, in our view, and features spectrum sold at or near the reserve price. Paradoxically, we think this is also a positive outcome for DISH as it implies carriers have ample coverage (i.e. low-band) spectrum. The third scenario would feature a high price paid. In our view, this would be negative for DISH shares, as carriers, having spent nearly $45bn in last year’s AWS-3 auction would be further leverage constrained, and would likely be less interested in negotiating for DISH spectrum."
No change to the $80 price target.
Shares of Dish Network closed at $49.59 yesterday.
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