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The downgraded dish grid (Nasdaq: dish) is a stock to hold from buying and has a price target of $7.30.
Benchmark analysts said the stock action last week over reports that Dish could partner with Amazon (AMZN) to offer wireless to Prime customers in the US. The nominal or free price indicates the potential of Dish’s network, yet the company has been extremely skeptical of any immediate initiative even before rejections from Amazon and the big MNOs.
According to one report, the online retail giant has likely been in talks with Verizon Communications (VZ), T-Mobile US (TMUS), and Dish Network (DISH) to get the lowest possible wholesale prices. However, Amazon cautioned in the report that there are no current plans, and T-Mobile also said it’s not in talks to include its service in Prime.
Analysts said fair value in the mid- or upper 30 remains viable in their estimation by recovering Dish’s $30 billion spectrum investment, through successful commercialization of open, cloud-based RAN and VoNR.
Dish will meet FCC requirements for its 600MHz licenses up to 70% of the US this month and is working to address liquidity concerns, including a $1 billion transferable maturity by 2024 that it currently can’t access. Direct debt market at satisfactory rates despite being a rich “asset”, according to analysts.
The company noted that the company’s management remains vague about clarity on addressing liquidity concerns, though it maintains that it can back out of its $3.5 billion purchase of Sprint spectrum from T-Mobile with only $72 million in payments.
In addition, analysts said that Dish’s Boost Infinite postpaid brand has been delayed several times even as the company ramps up marketing plans.
Dish, like other carriers and TMT companies around the world, uses AWS for cloud services, but Dish now doesn’t have the national reach and demonstrable Quality of Service (QoS) to appeal to Amazon for an immediate wireless offering to a Prime customer. the company added.
Analysts added that Dish would also lack the capacity required to resell AT&T’s MVNO service to offer national coverage.
More about the dish
- DISH Network: Cash is tight but having Amazon as a partner is helpful
- DISH Network: Why it can be a gamble to invest now