On Sep 30, 2014, we issued an updated research report on DISH Network Corp. (DISH).
On August 6, 2014, DISH Network reported dismal financial numbers for the second quarter of 2014, wherein both the top and the bottom line missed the respective Zacks Consensus Estimate. Moreover, the failure to strike deals with wireless operators to deploy a nationwide wireless network has been a major setback for DISH Network in recent times.
On a brighter note, an extensive wireless spectrum portfolio, innovative product launches, higher ARPU, the renewal of a multi-year contract with Scripps Networks Interactive and a video streaming deal with Disney are likely to spur growth for the company going forward.
In Sep 2014, DISH Network and lifestyle media channel owner Scripps Networks Interactive renewed a multi-year contract by way of which DISH will be able to offer the entire portfolio of Scripps’ channels to its subscribers. Significantly, the new agreement will enable DISH to offer its upcoming Internet TV subscribers to multi-stream Scripps’ content, either live or in the form of video-on-demand.
In June, DISH Network achieved a significant milestone by commercially launching the first wireless set-top box in the pay-TV industry. Subscribers will now be able to connect to DISH’s flagship Hopper Whole-Home HD DVR through a dedicated 802.11ac access point and watch TV shows on any device in and around the home through a wireless Joey device. A WiFi enabled set-top box is a significant innovation in the pay-TV industry as it eliminates the need for either coaxial or Ethernet wiring within a customer’s home premises.
DISH Network has postponed the launch of its Internet TV service from mid-2014 to the end of this year. Technically, Internet TV is similar to cable/satellite TV services. The lone difference is that cable/satellite TV can be watched solely on television sets, while Internet TV shows can be viewed using tablets and smartphones. We believe that the growing deployment of super-fast 4G LTE wireless technology and significant adoption of portable mobile devices are the primary reasons behind the popularity of Internet TV.
Stocks which warrant a look in this sector include Cablevision Systems Corporation (CVC), Comcast Corporation (CMCSK) and Saga Communications Inc. (SGA).
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