Citi: Dish Network's 3 Options To Unlock Value

DISH Network Corp DISH trades below its asset value and needs to make one of three potential moves to move higher, Citigroup analysts wrote.

First, the company can sell to Verizon Communications Inc VZ. Second, the company could acquire T-Mobile US Inc PCS. Third, it can sell wholesale capacity.

Of these, the analysts mentioned they believe the third option is most likely – so long as it is followed by Dish splitting the spectrum from the DBS business. In order to split the spectrum, it had to be earning revenue for five years. Therefore, Citigroup said, Dish can do so tax free in Q2 2016.

With these potential catalysts, Citigroup is maintaining its Buy rating on the stock with a  $94 price target – a 22 percent premium over current price at $76.78. Though the analysts said they understand why Dish trades at a discount, they do expect the gap between value and share price to converge in the next two years.