Canaccord Starts DishNetwork Corp. at Hold: Spectrum Value 'Priced In'

Dish Network Corp.'s DISH pay-TV market is mature to the point of over-ripeness and the company's valuable but unused wireless spectrum is priced into the company's shares, an analyst said Wednesday. Canaccord's Greg Miller launched coverage of the direct broadcaster with a Hold rating and $67 target, noting it hasn't seen subscriber growth since 2009. Englewood, Colo.-based Dish is "effectively a single-product company" but lacks the size and international presence of competitor DirecTV DTV. DirecTV is set to be acquired for $48.5 billion by AT&T T. Dish has been stockpiling broadcasting spectrum for a decade and two years ago, regulators gave the green light for the spectrum's use for broadband. Miller didn't estimate the value of Dish's spectrum holdings although some have recently tagged it at up to $28 billion. But Miller isn't alone in expressing skepticism that Dish can build out a wireless network on its own. A merger with Sprint Corp. S or T-Mobile US Inc TMUS, or failing that, a sale of the spectrum, would "unlock value," Miller said. Dish reportedly has taken tentative steps to explore acquiring T-Mobile from its controlling shareholder Deutsche Telekom AG DTEGY, but status of a deal isn't clear. Dish Chief Executive said last month that any deal is "unlikely" prior to a November federal auction of additional spectrum that is expected to provide clarity on the market value of Dish's holdings. "We're intrigued," Miller said, adding that Dish's current valuation "doesn't offer sufficient upside" to recommend its shares. Dish traded recently at $65.42 a share, down $0.46.