Trefis Helps You Understand How a Company's Products Impact Its Stock Price
COMPANY OF THE DAY : DISH NETWORK
Dish Network's new Hopper DVR and Primetime Anytime service threaten to shake up the pay-TV industry.
Broadcasters have lambasted these offerings and sued Dish for copyright infringement and a host of other claims. This makes sense given broadcasters reliance on advertising and the premium ad pricing for primetime slots.
See Complete Analysis for Dish Network
Broadcasters have lambasted these offerings and sued Dish for copyright infringement and a host of other claims. This makes sense given broadcasters reliance on advertising and the premium ad pricing for primetime slots.
See Complete Analysis for Dish Network
Related Companies:
Comcast
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AT&T
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Verizon
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Sprint Nextel
FORECAST OF THE DAY : NETFLIX'S U.S. STREAMING SUBSCRIBERS
We believe that Netflix's streaming business is showing promising signs of growth that support our sanguine outlook.
US streaming is facing heightened competition, but its content efforts and best-in-class streaming services will defend its growth.
Read more...
US streaming is facing heightened competition, but its content efforts and best-in-class streaming services will defend its growth.
Read more...
RECENT ACTIVITY ON TREFIS
Airline Stocks Take Off As Oil Plummets To Sub-$90 Levels
Airlines are continuing their gains as they cheer the fall in jet fuel prices. US Airways (NYSE:LCC) retained the top gainer spot with 11% upside followed by United Continental (NYSE:UAL), Alaska Airlines (NYSE:ALK), Delta Air Lines (NYSE:DAL) and Southwest (NYSE:LUV) which managed close to 5% appreciation in their stock. The jet fuel prices have fallen to $2.92/gallon on May 23, a 14% drop from this year’s high of $3.39/gallon on February 24. If the fuel prices stay at current levels, the jet fuel price estimate of $3.19/gallon by IATA (International Air Transport Association) for this year would need serious revision. Below we present our analysis on the magnitude of savings that the airlines can realize through this fall.
Europe Says Fair Play Is The Order of the Day for MasterCard
MasterCard’s (NYSE:MA) operations in Europe faced a big setback this week as the European Union’s General Court ruled against the company’s challenge to overturn an earlier decision regarding the cross-border fees charged by the company. Cross-Border fees are charged by MasterCard on international transactions. The court however, ruled that fees charged were inflated and unfair to both retailers and customers. MasterCard, along with competitors Visa (NYSE:V) are expected to contact the authorities to understand the rules for compliance with the ruling.
Southwest Can Take Latin America By Storm If Houston Hobby Gains International Routes
In its bid to tap international markets, Southwest (NYSE:LUV) reached another milestone as it got approval for the initiation of international operations from the Houston Hobby Airport. The airline is willing to fully fund the project that would require investments worth $100 million. These initiatives are a part of the carrier’s long term vision of starting international services to Mexico, the Caribbean and cities in Central and South America from this airport by 2015. The carrier’s acquisition of AirTran for $3.4 billion was also targeted to facilitate its entry into international markets through Mexico and the Caribbean. While the deal is subject to approvals from Houston City Council, United Continental (NYSE:UAL) is lobbying hard against this deal to overcome competitive pressures in this region. United has dominant presence in Houston through the George Bush Intercontinental (IAH) Airport from where it provides international services.
Wells Fargo Set To Double Its Asset Management Business
Wells Fargo (NYSE:WFC) seeks to double its asset management business in coming years – a move we see as a logical step for the bank which demonstrated the importance of a well-diversified business model to get through a difficult economic period. The bank with the largest market cap has set a goal of doubling its $444 billion asset management unit by 2018. And it will look to get there by expanding internationally besides being on the lookout for suitable acquisition options. Interestingly, Wells Fargo has set this target even as the asset management industry falls out of favor with major competitors. Bank of America (NYSE:BAC) and Morgan Stanley (NYSE:MS) sold parts of their asset management businesses in recent years, while Deutsche Bank (NYSE:DB) is currently in the process of selling off a huge chunk of the same. We maintain a $35 price estimate for Wells Fargo’s stock, which is about 12% above the current market price.
Coca-Cola Makes Big Bets On Africa's Future
Coca-Cola Co (NYSE:KO) plans to invest heavily in Africa in the coming years as it hopes to leverage its strong brand name to gain more customers for its well known brands. Tanzania and Kenya, in particular, have received a major chunk of the planned investment so far with the company announcing its decision to invest $187 billion in Tanzania in the next three years. Recently, the company also opened a new bottling plant in Somaliland at an investment of $15 million. We estimate a $76 price for Coca-Cola, which is in line with the market price.
Five Nicotine Stocks to Dodge the Euro Storm
Submitted by Mike Anthony as part of our contributors program . Going into the holiday-extended weekend, many traders may be cautious about holding positions. Should Greece decide to exit the euro, markets could be shaken up on Tuesday. Still, some sectors may offer a degree of stability. Nicotine stocks — a consumer staple — could provide a place for traders to seek shelter. Many of these stocks have been moving higher in recent weeks. Still, there may still be time to get into some of these names, as they are mostly below record levels.
BofA, Barclays Sell Archstone Stake To Lehman
Bank of America (NYSE:BAC) and Barclays (NYSE:BCS) will sell their remaining 26.5% stake in Archstone to Lehman Brother Holdings for $1.58 billion. The deal which would likely be completed in this quarter is the second round of stake sale by the banks to the bankrupt Lehman this year, with the first round in January bringing in $1.325 billion.
Adobe Struggles With Rising iOS Mobile Device Penetration
Adobe (NASDAQ:ADBE) is trying to monetize the Flash Player by introducing premium features to support 3D content on Flash. It plans to charge game developers 9% of their gross revenues after the first $50,000 for using a set of premium APIs which are designed for high end gaming. The Flash Player is the gaming platform of choice for many users on the web, with about 1.3 billion devices and 9 of the top 10 social games running on it. This has made its hold over PC based casual gaming absolute. The issue for Adobe arises from the rapid rise in tablet and smart-phone penetration. The Flash Player platform is not supported on mobile iOS devices such as iPod, iPad and the iPhones. With mobile devices becoming the device of choice for casual and social gaming, Adobe needs ways to support its popular content on iOS mobile devices as the casual gaming market size in 2011 was nearly $5 billion and is poised to grow to about $8.7 billion in 2014 according to the Casual Games Association. We take a look at some of the alternatives.
Sprint Promotes Unlimited Plans As Verizon, AT&T Move To Shared-Data Plans
After Verizon (NYSE:VZ) and AT&T (NYSE:T) touted shared-data plans earlier this month raising subscriber heckles about the future of unlimited plans, Sprint (NYSE:S) has been cashing in on the opportunity to promote its iPhone unlimited plans. It is also offering a $100 rebate to new subscribers if they trade-in their existing iPhone from a different carrier for a new two-year contract with Sprint. Verizon and AT&T have already stopped offering unlimited plans to new subscribers and the former is planning to do away with the grandfathered unlimited users as well. (see Verizon Looks To Substitute Unlimited Plans With Shared Data Plans For LTE ) Both have plans to introduce shared data plans and the latter will be looking to follow in Verizon’s footsteps and do away with unlimited plans completely. (see AT&T Looks To Reduce Subsidy Pressures While Boosting Revenues Through Shared Data Plans ) In such a scenario, Sprint will remain the only national carrier to offer truly unlimited plans (T-Mobile throttles 3G speeds after a certain limit), which it is using as a ploy to lure subscribers away from the two larger carriers. We have a price estimate of $4 for Sprint, about 50% ahead of the current market price.
Weekly Mobile Notes: Googorola Complete, Windows Phone In China, Apple iTV Rumors Debunked
The past week saw quite a few developments in the mobile sector. Google (NASDAQ:GOOG) acquired Motorola Mobility (NYSE:MMI) earlier this week after China finally signed off on the merger following months of intense speculation about China’s true intentions. Microsoft’s (NASDAQ:MSFT) COO for the Greater China region said that the company’s Windows Phones have already reached a 7% market share in the country trumping Apple (NASDAQ:AAPL) iPhone’s 6%. Further, after multiple rumors surrounding Apple’s iTV plans came out, we took a deep dive into the TV market to see how much of an impact the much rumored TV would have on Apple’s stock. Googorola Google has received the final approval for its proposed Motorola Mobility acquisition from the Chinese authorities after months of intense speculation that the country could block the deal altogether. China has however extracted a promise from Google that Android would remain completely open-source for the next five years at least. Google has already received approvals from the U.S., Europe and Israel, and will be looking to close the deal this week itself. The news alleviates investor concerns that the deal may face significant roadblocks in China considering the rather unpleasant past relationship between Google and China. (see Why Investor Concerns on the Googlorola Deal Falling Apart Are Premature ) The acquisition however will put Google’s margins under immediate pressure. We estimate that Motorola Mobility will generate $13.1 billion in revenues and only 64 million in operating profits in 2012. This will significantly dent Google’s overall operating margins (adjusted for operating leases) to about 27% from ~35% pre-acquisition. (see Google’s Margins At Risk With Mobile Push From Motorola Deal ) See our complete analysis of Google here Microsoft A Microsoft executive claims the company has made good on what seemed like a lofty claim made just two months back that it plans to overtake iPhone’s market share in China. According to the company’s COO for the Greater China region, Microsoft’s Windows Phone has already reached a 7% market share in the country trumping Apple’s 6%. (see Microsoft Passes Apple In China As Nokia Cheers ) While it was never a tall order for Microsoft to achieve that target considering that iPhone’s market share wasn’t too high in the first place, the fact that the company has reached this milestone in such a short period of time shows that China will play a key role in shaping Windows Phone’s as well as its key partner Nokia’s fortunes in the coming quarters. Growing acceptance for Windows Phones will help Microsoft and Nokia draw in developers to build apps for the platform. Although the Lumia has garnered rave reviews on the web and is seen by many as a worthy third competitor to Apple and Google, lack of app support for the platform is Windows Phone’s biggest weakness currently. Microsoft is trying to overcome this weakness by coming up with an app migration service that would let users port apps and app data from other platforms on to Windows Phone. (see Microsoft Working At Migrating Other Platform Apps to Windows Phone ) See our complete analysis of Microsoft here Apple Rumors surrounding Apple’s (NASDAQ:AAPL) foray into the TV market seem to be growing in number every day with some even claiming that the new iProduct could be arriving as soon as before the end of the year. The most recent one was floated by AppleInsider, which claimed that Apple is seeking to buy German luxury TV maker Loewe but the latter shot down these claims soon after. While most of these rumors have not been fact-based, Foxconn parent Hon Hai Precision Industry’s confirmed decision to invest in LCD display maker Sharp Corp a couple of months back lent some credence to the rumors. (see Is Apple The Invisible Force Behind The Sharp-Foxconn Deal? ) While there is a lot of speculation surrounding Apple’s new iProduct, there have been few attempts so far to size the opportunity that the TV market presents for Apple. Unlike smartphones and tablets, two markets that were still very young or even unformed when Apple launched the iPhone and the iPad, the TV market is a huge multi-billion dollar industry that Apple will be trying to penetrate. Still, the general opinion seems to be that the opportunity is there for Apple to enter and disrupt it. However, we believe that the TV market holds very little value for Apple should it launch what is being rumored to be the ‘iTV’. (Read Apple’s Rumored iTV Plans Don’t Add Much To $700 Stock Value to know why) See our complete analysis of Apple here Understand How a Company’s Products Impact its Stock Price at Trefis
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