Brean Capital Sees Potential Opportunity to Be More Aggressive for TiVo

In a report published Wednesday, Brean Capital analyst Todd Mitchell reiterated a Buy rating and $16.00 price target on TiVo (NASDAQ: TIVO).In the report, Brean Capital noted, “We are buyers for an expansion of distribution. TiVo is a turnkey outsourced TV Everywhere service platform with a hybrid-SAAS business model. We believe there is a large addressable market for TiVo's offering and particular business model. However, when TiVo reported F2Q15 results yesterday after the close the company's momentum was a little disappointing. Gross adds were up year-over-year, and TiVo seems to continue to enjoy strong traction with the Tier-2 U.S. MSO, but with Virgin appearing to scale back somewhat, overall growth appears to have decelerated fairly materially from just last quarter. Simply put, in order to maintain its current valuation, we believe TiVo will need to announce an expansion of its customer base within the next quarter. Management continues to assure investors that this is coming, and independent due diligence points to the likelihood of a deal with a large European MSO. As such, we would view any weakness on the back of F2Q15 results as an opportunity to be more aggressive. Reiterate Buy rating and $16 price target.”TiVo closed on Tuesday at $13.90.