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EchoStar Corp Class A ECHO

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Stock XNAS Rating as of
$94.25 +6.00 (6.80%)
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As of Delayed Price Post-Trading: $94.25 0.00

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EchoStar Is Increasingly a Bet on SpaceX

Michael Hodel

For years, EchoStar has remained steadfast in its belief that it could build a wireless business to capitalize on the value of its wireless licenses. No real signs of success emerged, and the firm's finances were left in tatters. However, the decision to sell its spectrum licenses to AT&T and SpaceX immediately realizes value for shareholders, dramatically reduces balance sheet risk, and opens a new chapter in EchoStar's development. Capital allocation is now the biggest issue facing shareholders, and EchoStar's track record is not strong.

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Price vs Fair Value

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ECHO is trading at a LOCK|lRg&kYR premium.
Price
$88.27
Fair Value
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Uncertainty
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1-Star Price
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5-Star Price
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Economic Moat
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Capital Allocation
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Bulls Say, Bears Say

Bulls

Additional wireless spectrum will be needed to meet exploding demand for wireless data services. AT&T's decision to pay a big premium for some of EchoStar's licenses reflects this reality. Verizon and T-Mobile will need to step up to buy EchoStar's remaining licenses.

Bears

After more than a decade, EchoStar failed to put a viable wireless network or business strategy in place. Shareholders are now being asked to trust the management team to reinvest the proceeds from its planned spectrum sales.

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Trading Information

Previous Close Price
$88.25
Day Range
$87.71–94.58
52-Week Range
$65.76–147.25
Bid/Ask
$92.80 / $94.24
Shares Outstanding
290.82M
Market Cap
$27.41B
Volume/Avg
5M / 4M

Key Statistics

Price/Earnings (Normalized)
—
Price/Sales
1.93
Dividend Yield (Trailing)
0.00%
Dividend Yield (Forward)
0.00%
Dividend Payment Schedule
—
Total Yield
0.19%

Company Profile

Satellite television provides the bulk of EchoStar’s revenue. The firm serves about 5 million US satellite customers, about 10% of the traditional television market. It also serves 2 million customers under the Sling brand. EchoStar has also amassed an extensive portfolio of spectrum licenses. It acquired Sprint's prepaid business, serving approximately 7 million customers, primarily under the Boost brand. The firm has agreed to sell a portion of its wireless licenses to AT&T and SpaceX, and will rely heavily on the AT&T network to serve customers. EchoStar’s legacy businesses provide satellite telecom services and equipment to businesses and consumers, including about 700,000 internet customers.
Sector
Communication Services
Industry
Telecom Services
Stock Style Box
Mid Value
Total Number of Employees
12,100
Website
https://www.echostar.com

Competitors

Valuation

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Metric
ECHO
VZ
TMUS
Price/Earnings (Normalized)
 —9.4214.48
Price/Book Value
 1.811.853.09
Price/Sales
 1.931.391.94
Price/Cash Flow
 197.914.705.72
Price/Earnings
ECHO
VZ
TMUS

Financial Strength

Metric
ECHO
VZ
TMUS
Quick Ratio
 0.370.500.54
Current Ratio
 5.200.640.92
Interest Coverage
 −3.273.894.44
Quick Ratio
ECHO
VZ
TMUS

Profitability

Metric
ECHO
VZ
TMUS
Return on Assets (Normalized)
 −1.07%4.06%5.90%
Return on Equity (Normalized)
 −4.68%15.75%21.68%
Return on Invested Capital (Normalized)
 2.01%7.53%8.82%
Return on Assets
ECHO
VZ
TMUS

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LOCK|<pR%%&jgLOCK|yQm$$$173B
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LOCK|J?%LOCK|FGL$%$167B
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LOCK|lycfC^LOCK|^$$$38B

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