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The Satellite News Financial Ticker

By Staff Writer | March 22, 2004
      Week of 3/12/04 – 3/18/04
      Percentage Change
      Symbol
      March 18 Price
      One Week
      One Month
      Three Month
      Year to Date
      Operators
      APT SATELLITE HLDGS ATS
      2.10
      –
      (17.3)
      (10.3)
      (11.8)
      ASIASAT TELECOM SAT
      17.50
      (9.3)
      (17.5)
      (4.2)
      (7.8)
      BRITISH SKY BROADCASTING BSY
      52.80
      1.0
      (6.3)
      3.0
      3.7
      ECHOSTAR COMM -CL A DISH
      33.44
      (5.4)
      (13.5)
      1.6
      (1.6)
      HUGHES ELEC (GM -CL H) GMH
      15.94
      2.8
      (9.1)
      2.0
      (3.7)
      LORAL SPACE & COMM LOR
      0.62
      (4.5)
      (20.4)
      82.6
      97.1
      NEWS CORP NWS
      35.11
      (0.9)
      (9.2)
      0.8
      (2.7)
      NEW SKIES SATELLITES NSK
      6.55
      1.9
      (3.2)
      (7.2)
      (8.5)
      PANAMSAT SPOT
      23.62
      2.5
      0.1
      12.5
      9.6
      PASIFIK SATELIT NUSANTARA PSNRY
      0.25
      (2.0)
      22.5
      145.0
      390.0
      PEGASUS COMMUNICATIONS PGTV
      35.03
      (0.8)
      28.6
      83.8
      24.8
      SES GLOBAL SESF.LU
      7.15
      (1.4)
      (8.9)
      (5.7)
      (10.6)
      SIRIUS SATELLITE RADIO SIRI
      3.19
      11.1
      8.1
      46.7
      0.9
      XM SATELLITE RADIO XMSR
      27.84
      11.4
      22.9
      21.0
      5.9
      Operators’ Average  
      100.00
      0.5
      (1.7)
      26.6
      34.7
      Manufacturers
      ANDREW ANDW
      17.24
      3.0
      (1.9)
      53.9
      48.7
      BALL BLL
      64.88
      (0.5)
      1.1
      10.9
      8.9
      BOEING BA
      39.82
      (0.8)
      (10.7)
      (3.7)
      (5.5)
      COM DEV INTL *CDV
      2.67
      2.7
      (8.2)
      (10.7)
      (7.3)
      EMS TECHNOLOGIES ELMG
      18.02
      9.4
      (23.4)
      (8.2)
      (12.3)
      GARMIN GRMN
      40.49
      (1.2)
      (14.0)
      (25.6)
      (25.7)
      GILAT SAT NETWORKS GILTF
      8.93
      18.1
      18.4
      86.8
      82.6
      GLOBECOM GCOM
      5.70
      (4.7)
      (6.7)
      4.6
      20.0
      HARRIS HRS
      46.00
      3.6
      (6.3)
      20.7
      21.2
      HONEYWELL HON
      33.00
      1.7
      (7.7)
      4.5
      (1.3)
      KVH KVHI
      14.00
      (6.8)
      (22.9)
      (52.4)
      (49.2)
      LOCKHEED MARTIN LMT
      44.60
      (0.1)
      (8.5)
      (10.9)
      (13.2)
      LUCENT TECHNOLOGIES LU
      4.13
      8.1
      (1.7)
      41.0
      45.4
      MOTOROLA MOT
      17.04
      2.3
      (0.1)
      27.2
      21.7
      ORBITAL SCIENCES ORB
      12.15
      1.2
      (9.9)
      (2.0)
      1.1
      QUALCOMM QCOM
      64.96
      5.1
      10.0
      26.2
      20.5
      RAYTHEON RTN
      30.07
      (0.1)
      (5.4)
      1.0
      0.1
      ROCKWELL COLLINS COL
      30.24
      0.9
      (7.8)
      3.3
      0.7
      SCIENTIFIC-ATLANTA SFA
      31.31
      1.5
      (7.0)
      13.3
      14.7
      SKY FRAMES SKYU
      0.10
      –
      100.0
      (71.4)
      –
      TITAN TTN
      20.36
      4.7
      (2.8)
      (6.6)
      (6.6)
      TRIMBLE NAVIGATION TRMB
      21.94
      5.0
      (7.1)
      (1.4)
      (11.6)
      VIASAT VSAT
      24.89
      (1.5)
      (10.3)
      33.1
      30.0
      Manufacturers’ Average  
      100.00
      2.3
      (1.4)
      5.8
      8.0
      Nasdaq Composite Index
      Nasdaq comp
      1,960.98
      0.9
      (5.6)
      0.2
      (2.1)
      SP 500 sp50
      1,119.72
      1.2
      (2.8)
      2.8
      0.7
      SN Stock Price Average
      100.00
      1.6
      (1.5)
      13.7
      18.1

      Wall Street Analysis

      By Paul Dykewicz, PBI Media LLC

      The likely sale of PanAmSat [SPOT] was reflected in reports from two satellite analysts last week who focused on the valuation of the company and its newly renamed parent rather than leaving any doubt that a deal would occur.

      By renaming Hughes Electronics as The DirecTV Group and changing the ticker from HS to DTV, the News Corp-led [NWS] organization is positioning itself to focus attention and resources on its satellite television operation. Thomas Eagan, a satellite and cable analyst with Oppenheimer, issued a research note Friday just before press time predicting that DirecTV Group’s PanAmSat [SPOT] and Hughes Network Systems (HNS) business units would be sold. He also forecast a combining of the two News Corp-owned Latin American satellite television operations.

      A rationalizing of the company’s divisions will enable DirecTV Group to report higher company cash flow growth while more easily showing it trades at a lower multiple on a cash-flow and per-subscriber basis than Wall Street analysts previously had calculated, Eagan explained.

      The satellite TV operation of DirecTV Group has an estimated 2004 cash flow of 35 percent, compared with 32 percent for all the parent’s operations combined. The parent company’s current trading multiples suggest that the U.S. satellite TV unit is valued at slightly more than $1,700 per subscriber, 15.7 times 2004 estimated cash flow and more than 40 times 2004 estimated free cash flow. In comparison, EchoStar is higher priced on a per-subscriber basis but equivalent on a cash-flow basis. A sale of PanAmSat and HNS would further widen that valuation gap between DirecTV and EchoStar – spurring Eagan to rate DirecTV Group a “buy” for investors.

      Patrick Fuhrmann, a satellite analyst with ABN AMRO, said speculation about the sale of PanAmSat now has the company’s stock price fully valued. PanAmSat’s negotiating power to boost the price further appears limited due to a “small universe of potential buyers,” he added. Overcapacity is expected to “plague” the sector for at least another year and the company’s backlog is on the decline, Fuhrmann concluded.

      Paul Dykewicz is senior editor and senior analyst of Satellite News. He can be reached at 301/354-1769 or at [email protected].

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