One way to buy stocks is to concentrate on companies that make products you know and like. For me, DirecTV (DTV) falls into that category. Over fifteen years ago, I moved to a rural area that did not have cable TV. DirecTV (founded in 1994, see history here--I've been a customer since 1996) was the only option. Over the years, I have become a fan of the company as have many of my neighbors and many people I meet casually. The video above provides the CEO's take on the company prospects (I was a little surprised that more streaming content would not appear until 2013).
My telephone provider, Telephone & Data Systems (TDS), offers a bundle that includes DirecTV's primary competitor, DISH network (DISH). I have often looked at the TDS-DISH bundle but have never thought the price and channel selection was good enough to switch.
How do the Random Stock Walker models compare with the result of personal product experience? Bottom line: DirecTV is well linked to growth in the world economy while DISH is a business-as-usual (BAU) stock.
The DTV forecast (based on the WL20 model) is presented above. Strong growth is predicted throughout 2012. The analyst opinion (here) is mostly "buy" with a high price target of 60 (well above the 98% prediction interval for 2012) and a low target of 43 (reasonable for 2011). DTV's P/E ratio is almost 30 with a forward P/E of almost 12
The DISH forecast is presented above. The forecast is for the price to rise into the 30-35 range until about 2015 when no further growth is predicted. The analyst opinion (here) is also mostly "buy." If you accept the BAU forecast above, only the short-term looks promising. The long-term upside potential is not very strong. DISH has also had a choppy history, peaking during the dot-com bubble and not performing very well after than.
The DTV forecast (based on the WL20 model) is presented above. Strong growth is predicted throughout 2012. The analyst opinion (here) is mostly "buy" with a high price target of 60 (well above the 98% prediction interval for 2012) and a low target of 43 (reasonable for 2011). DTV's P/E ratio is almost 30 with a forward P/E of almost 12
The DISH forecast is presented above. The forecast is for the price to rise into the 30-35 range until about 2015 when no further growth is predicted. The analyst opinion (here) is also mostly "buy." If you accept the BAU forecast above, only the short-term looks promising. The long-term upside potential is not very strong. DISH has also had a choppy history, peaking during the dot-com bubble and not performing very well after than.
No comments:
Post a Comment