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The Satellite News Financial Ticker

By Staff Writer | December 8, 2003

      Week of Nov. 28- Dec. 4, 2003
      Percentage Change
      Symbol
      Dec. 4
      Price
      One
      Week
      One
      Month
      Three
      Month
      Year to
      Date
      Operators
      APT SATELLITE HLDGS ATS
      2.56
      (1.2)
      3.6
      (15.5)
      48.8
      ASIASAT TELECOM SAT
      17.55
      5.1
      (2.0)
      6.9
      54.1
      BRITISH SKY BROADCASTING BSY
      46.97
      (0.9)
      3.8
      9.3
      17.2
      ECHOSTAR COMM -CL A DISH
      33.47
      (2.8)
      (12.3)
      (12.6)
      50.4
      HUGHES ELEC (GM -CL H) GMH
      16.07
      (2.1)
      (3.4)
      7.5
      50.2
      LORAL SPACE & COMM LOR
      0.30
      (3.2)
      (13.0)
      50.0
      (93.0)
      NEWS CORP NWS
      34.23
      (0.2)
      (4.6)
      (2.8)
      30.4
      NEW SKIES SATELLITES NSK
      7.00
      4.9
      6.1
      26.1
      68.7
      PANAMSAT SPOT
      21.65
      (1.3)
      0.9
      34.9
      47.9
      PASIFIK SATELIT NUSANTARA PSNRY
      0.01
      (94.3)
      (94.6)
      (87.5)
      (93.3)
      PEGASUS COMMUNICATIONS PGTV
      18.72
      (6.6)
      4.3
      (1.5)
      42.9
      SES GLOBAL SESF.LU
      8.04
      (1.3)
      2.3
      32.5
      25.6
      SIRIUS SATELLITE RADIO SIRI
      2.15
      8.6
      (9.3)
      30.6
      235.9
      XM SATELLITE RADIO XMSR
      23.36
      (2.2)
      17.2
      68.4
      768.4
      Operators’ Average
      100.00
      (7.0)
      (7.2)
      10.5
      89.6
      Manufacturers
      ANDREW ANDW
      11.28
      (4.6)
      (16.1)
      (13.6)
      9.7
      BALL BLL
      58.70
      5.6
      4.4
      10.3
      14.7
      BOEING BA
      39.10
      2.1
      0.5
      1.9
      18.5
      COM DEV INTL *CDV
      3.20
      (0.3)
      21.2
      81.8
      223.2
      EMS TECHNOLOGIES ELMG
      20.52
      (5.5)
      10.3
      9.8
      31.8
      GARMIN GRMN
      54.55
      (2.6)
      2.4
      27.8
      86.2
      GILAT SAT NETWORKS GILTF
      4.79
      (3.8)
      (4.6)
      (2.0)
      (38.6)
      GLOBECOM GCOM
      6.32
      8.8
      39.8
      37.1
      68.5
      HARRIS HRS
      37.94
      (1.3)
      (0.1)
      11.1
      44.3
      HONEYWELL HON
      30.15
      1.0
      (2.1)
      1.1
      25.6
      KVH KVHI
      30.60
      0.2
      5.7
      7.7
      255.8
      LOCKHEED MARTIN LMT
      47.90
      4.2
      4.0
      (8.0)
      (17.1)
      LUCENT TECHNOLOGIES LU
      3.07
      (2.5)
      (6.1)
      44.8
      143.7
      MOTOROLA MOT
      13.40
      (3.5)
      (3.2)
      26.7
      54.9
      NERA NERAY
      2.05
      (6.4)
      (1.2)
      (8.4)
      89.3
      ORBITAL SCIENCES ORB
      10.99
      18.4
      17.4
      19.7
      160.4
      QUALCOMM QCOM
      49.10
      10.4
      1.8
      21.6
      34.9
      RAYTHEON RTN
      28.72
      3.1
      6.2
      (11.2)
      (6.6)
      ROCKWELL COLLINS COL
      27.14
      1.0
      (2.0)
      (0.6)
      16.7
      SCIENTIFIC-ATLANTA SFA
      27.70
      (3.9)
      (8.0)
      (20.8)
      133.6
      SKY FRAMES SKYU
      0.10
      –
      (83.3)
      (88.2)
      (98.8)
      TITAN TTN
      21.45
      0.5
      1.5
      30.0
      106.3
      TRIMBLE NAVIGATION TRMB
      30.34
      0.7
      3.8
      6.5
      142.9
      VIASAT VSAT
      20.82
      (1.6)
      (0.6)
      28.5
      80.4
      Manufacturers’ Average
      100.00
      0.8
      (0.3)
      8.9
      65.8
      Nasdaq Composite Index
      Nasdaq
      comp
      1,968.80
      0.8
      0.1
      6.3
      47.4
      SP 500
      sp50
      1,069.72
      1.1
      1.0
      4.2
      21.6
      SN Stock Price Average
      100.00
      (2.0)
      (2.9)
      9.5
      74.6

       

      Wall Street Analysis

      By Tom Watts, SG Cowen Securities

      The Federal Communications Commission (FCC) staff has forwarded a recommendation to the five commissioners to approve News Corp’s [NYSE: NSK] acquisition of a 34 percent interest in Hughes Electronics [NYSE: GMH].

      The FCC staff recommendation would impose minor conditions that formalize voluntary pledges made earlier by News Corp and Hughes’ DirecTV unit. Those conditions include a requirement to offer local channels to 130 markets by year-end 2004, and a non-binding arbitration procedure for cable operators to use if programming negotiations with News Corp’s Fox unit become problematic.

      These conditions appear minimal and should not prevent Fox from gaining almost all the benefits anticipated from News Corp’s acquisition of Hughes. We expect the FCC commissioners to give approval shortly, enabling the deal to close before year-end.

      Under the merger agreement, Hughes shareholders would receive new shares for 82.5 percent of their holdings. The new stock will be asset-based, not a tracking stock. The tracking stock currently used by Hughes shareholders will be eliminated. Upon closing of the deal, 17.5 percent of each share of the new Hughes stock will immediately be exchanged for about $14.60 payable in News Corp preferred ADRs ($26.88 x .521). The terms of the deal are based on the April 8 closing price of News Corp Series A preferred price of $22.40, subject to a collar of plus or minus 20 percent ($17.92 – $26.88). Based upon a 20 day average of about $28, 0.521 shares of News Corp Series A preferred shares will be payable ($14/$26.88)

      These values imply that a current Hughes share is worth about $15.78 ($16.04 x 82.5 percent + $14.60 x 17.5 percent) — a discount from last week’s trading price. Nevertheless, we foresee a number of approaching catalysts for Hughes stock, including final approval of the deal by the FCC, closing of the deal, public appearances of the new management team after the closing, and finally, more details. Those details would address specific actions News Corp intends to take with Hughes. News Corp wanted to wait to disclose those details until after receiving all the government approvals. Overall, the near-term looks positive for Hughes shareholders.

      Tom Watts is a managing director and satellite analyst at SG Cowen Securities. He can be reached by phone at 212/278-4260 or by e-mail at [email protected]. Readers should assume that SG Cowen Securities Corp. and/or its affiliates intend to offer services in investment banking to the above referenced companies within the next three months, and to seek compensation for such services.

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