Dish Network gives a nice surprise for the Holidays

[TheForce]

Surprise!

Dish Network announces a surprise Dividend of $2 a share this week.

Ex Dividend date is Nov 18th and the pay out is December 2.


Thank you, Dish Network.

 

[MikeinBaja]

Nice for investors - sort of rubs a little salt into the wounds of the folks they just laid off though.

Timing sorta sucked.

 

[Slamminc11]

Nice for investors - sort of rubs a little salt into the wounds of the folks they just laid off though.

Timing sorta sucked.

well, depending on how long they had been with Dish, they received profit sharing shares of stock for at least the last few years, so they will get paid on those shares

 

[riffjim4069]

How 'bout a Holiday Gift for subscribers...real HD and not that TurboHD-Lite stuff .

 

[mike123abc]

It is an interesting move. I wonder if they are trying to get it in before the end of the year to avoid a possible tax increase next year. The dividend tax rate is 15% (max) until 2011 but maybe they do not want to take chances.

This is nearly a billion dollars (447 million shares).

It also makes me think that they think TiVo suit will wrap up soon and they do not need the cash on hand.

 

[TheForce]

Yes, Mike, it is interesting. Dish as well as DTV doesn't normally distribute earnings in dividends.
The last time Dish gave out a cash Dividend was on Dec 6, 2004 ( $.90 a share).

I've always felt the Tivo mess was never going to really impact Dish anyway. If the impact of the dividend raises the value of the stock thru a rush to buy, it could be of even better benefit to Charlie and company in a TIVO buy out. Consider a run up of the stock to $35 a share impact on a TIVO for DISH stock plus cash buy out.

 

[RVD420]

it could be of even better benefit to Charlie and company in a TIVO buy out.

Charlie can't buy Tivo out.

There is a poison pill provision that makes it cost prohibitive to buy Tivo out.

 

[jacmyoung]

Charlie can't buy Tivo out.

There is a poison pill provision that makes it cost prohibitive to buy Tivo out.

If this is any indication that Charlie is confident that he will win the appeal, then TiVo's stock value may tank if the appeals court overturns the contempt ruling.

Based on the PTO documents, there is clear evidence that TiVo had misled Judge Folsom when they said the software claims had nothing to do with start code detection and indexing. As a result Judge Folsom handed TiVo the contempt win.

But misleading the court is a misconduct that can result in sanctions. Charlie now has clear evidence at hand to pursue misconduct charges after the appeals court ruling, no matter which way the ruling will be. Charlie's charges against TiVo will make TiVo undesirable to any other potential buyers, while TiVo's value tanks.

Of course the above is speculation, but nevertheless a possible way to overcome that "poison pill".

 

[dangue]

As a shareholder, I appreciate the dividend. But, at the same time, if this money was originally earmarked for the Tivo settlement, this smacks of overconfidence. Surprisingly, the stock price hasn't really jumped on the news so the dividend is at just under 10% right now. It might be worth buying more, hmmm...

 

[jacmyoung]

DISH is up by nearly 10% since the quarterly conference, while NASDAQ is up 3%. In fact if you go back a few days start from when DirecTV had their quarterly, DISH is up about 20% while NASDAQ is flat.

How do you measure how much the stock should jump on the news? I am not sure if the current DISH value is high or low, just asking how much a jump should be considered a good jump on the news.

 

[navychop]

Charlie can't buy Tivo out.

There is a poison pill provision that makes it cost prohibitive to buy Tivo out.

Poison pills can be negotiated away, or even challenged. Just a ploy in the game.

 

[jacmyoung]

Poison pills can be negotiated away, or even challenged. Just a ploy in the game.

Yup, those Yahoo shareholders could have got $33/share from Microsoft but because of then Yahoo CEO Jerry Yang's play of the "poison pill". Now his head rolled and lawsuits are flying all over.

Hopefully if things work out as Charlie has hoped, TiVo board will learn the lesson from Yahoo.

 

[TheForce]

jacmyoung-

First off, let me say I have followed your analysis of the tivo case and find what you post very insightful, well worth reading. But, having said that I decided not to participate in these tivo discussion threads because no matter what we discuss, we are not in the court room and have no idea what sort of schemes and plans Charlie's team nor Tivo's team are cooking up. So, it will be what it will be and no matter what the outcome, we will get what they want us to get. Meanwhile I decided time better spent studying the markets of both Dish and TIVO and determined the investment in TIVO is to be short for a minor jump in their stock based on court/legal announcements and Dish, the stock growth based on P/E and technical achievements not to mention overall market trends of the economic recovery. Just look at TIVO stock! There is little to no overall growth and only small bounces based on legal developments. This is a very very poor way to base an investment decision. Most people I read who side with TIVO's legal case do so based on personal emotion of the TIVO cutsieness of their DVR operating system. But fundamentally, they are a losing proposition.

How do you measure how much the stock should jump on the news? I am not sure if the current DISH value is high or low, just asking how much a jump should be considered a good jump on the news.

Good question! Once again your analysis is spot on but if you have been following the entire market in general with this recovery, it will become obvious that the recovery is not based on general growth ( GDP) but rather cost cutting and revenue protection, except in a few cases. So, the real jump in stock prices has been more of a function of speculation of future real growth rather than what is real growth now. We have seen more stock jumps up and down based on beating estimates by experts or not reaching estimates than seeing real business growth that impacts a stock. This is what you are seeing with Dish. The stock goes up when revenue growth is flat and churn is heavy.
There is nothing that has caused the stock to be truly valued at $10-11 a share where I got back in in April. Rather I see the stock selling in the mid $30's in 6 months. But I'm Bullish on many of these stocks. In 2007 DISH traded in the 40's and I see no reason why it can't return to that price point. In other words, comparing the fundamentals of the company back then and now it is the same. So with Dish, there is plenty of room to grow in the next 6-9 months.
Direct TV DTV on the other hand is trading at it's lifetime peak now so if you are not in, it would be foolish to buy in now. Nothing they are doing is reason for it to go much higher. I sold out some months back and will buy back into DTV when it falls way back. I think it is way over bought right now. DTV has never paid a dividend. I think DTV will be sold to new owners once again.

 

[jacmyoung]

Good post Don. I have absolutely no problem with your long term growth approach.

However, one should not simply dismiss those who prefer trading based on short term speculations. Development in the courtroom is one good way for speculation. A lot of professional traders make living on short term speculations.

What I agree with you is, those who speculate based on their personal emotional feeling towards one company/person or the other, tend to lose out. In fact I think the professional traders actually make a good living on these people They do not feed on investors like you because you look long term.

If all investors are like you, there will be no need of the Wall Street as we know it. Hopefully many investors will grow more mature and become more like you. But you know what, there is a sucker born every minute, Wall Street will never run out of supplies of suckers to feed it.

 

[TheForce]

We could have a really good discussion on these points you made. Actually, I understand and DO invest both ways. However, one needs to appreciate that some stocks can and will only be good for shorting its market. TIVO is definitely one like that but I avoided it because its up and downs were based on court decisions and that also appeared to me to be based mostly on the ignorance of the court system in this case. This makes investing, even for the short haul very much a game of chance like roulette. I prefer my risk to have some basis and track record as opposed to all outside influence. It TIVO could show it was developing additional revolutionary technology, I'd be in but it's sole business model today looks like a team of lawyers who sue based on near 10 year old technology rights. That's not for me!

However, I short stocks like AIG and have made some very nice returns this year on shorting that one. Buy in and wait 10 days and take my profits and wait for another buy in. Another I do short is Citigroup, Bank of America, and Sprint. I also shorted Sirius/ XM. Heck, I even short oil stocks like BP and CVX, although these stocks also have a nice Dividend ROI. But when it comes to Dividends, I prefer much higher rates of returns like the capital investment stocks that have dividends in the teens and even two I have in the 20's. On the long haul, I like Nat Gas companies. I think eventually we have to get more of our national fleet vehicles into NG and this will take off at that time. I also feel the nation's oil burning power plants will eventually convert to NG but not coal. Coal is very strong although not green for some liking.. Consequently, only way to invest today in NG is long.

As for brokers vs. self directed trading... Here's the deal. My wife asked me about this just yesterday, as in Why didn't you do this years ago rather than do those TV shows? The answer is really based in technology. Years ago, we didn't have the tools to invest on the heat of the moment like we can today with on line trading. Even as recent as the last bull market during the first Bush years ( not counting the bull market this year) you really had to call your broker and pray he acted on your request in a way that was profitable to you. You just couldn't follow real time what was happening to make any good decisions. I did a TV show back in 2003 for a company that had these trading tools as a product it was selling to the wannabee investor. The software was $2500 and they required a subscription service to work. It was very expensive. Today, you can get excellent trading tools for free and just pay a discounted commission per trade. All that is really required is a good mind for details, an interest in reading financials, and the commitment to spend every day working at it like a job. You suggested losers and I'll tell you losers are also those who think you can sock a small nest egg away and come back in 20 years and you'll be a millionaire. ha ha that will never happen. If you hire a CFP to manage it, he'll make some money at your loss. I really believe we are going to see the beginning of the end of these CFP vultures as a profession. Technology will make what they do a waste of money.

 

[jacmyoung]

... You suggested losers and I'll tell you losers are also those who think you can sock a small nest egg away and come back in 20 years and you'll be a millionaire. ha ha that will never happen. If you hire a CFP to manage it, he'll make some money at your loss. I really believe we are going to see the beginning of the end of these CFP vultures as a profession. Technology will make what they do a waste of money.

Not that it will NEVER happen, anything is possible, but odds are you might as well buy some lottery tickets over the years have similar luck that way, but without all the stress.

The losers I was talking about are those who want to get rich quick, without spending time to study the company and the issues. They listen to the analysts, but those analysts have their own interests, often times not in line with a greedy get rich quick investor. Not to mention many of those analysts have been proven wrong time after time.

Here is again my agreement with you that you are taking time to research for yourself, not just relying on some brokers or analysts. But I do not think the analyst world of the past will quickly disappear, because again going back to my point, there is a sucker born every minute, most people do not have the patience nor ability to do their own research, but they still want to get rich quick, so they will provide the endless supply of cash to feed those institutions.

But here is the thing, you should not even hope things to change too fast, because the more suckers out there, the more chances you, a savvy investor will have to succeed. If everyone is as rational and smart as you are, it will be much harder for you to make money

Every time you make good on your shorts, there is a sucker out there that had lost his money.

 

[Jhon69]

DISH is up by nearly 10% since the quarterly conference, while NASDAQ is up 3%. In fact if you go back a few days start from when DirecTV had their quarterly, DISH is up about 20% while NASDAQ is flat.

How do you measure how much the stock should jump on the news? I am not sure if the current DISH value is high or low, just asking how much a jump should be considered a good jump on the news.

Well I believe that Dish is on it's way back as DirecTV is putting in rules that are not friendly for the DirecTV subscriber,case in point me I came back due to crappy DVRs and not enough standard definition programming.

Plus why would Charlie even consider buying Tivo when Dish has the best technology?.Maybe to have something to wipe his boots on?.

 

[TheForce]

OK, today's the EX Dividend day which means if you didn't buy in before today you won't get this unprecedented dividend of $2 a share.

DISH stock took a $2 tumble this morning since yesterday's closing of just upwards of $22. But if you got in when the stock was way below $20 and are planning to hold til the stock gets much higher than $22 then this dividend comes as a nice holiday gift surprise. As most stock experts will tell you stocks tend to inflate to the mean share price leading up to the ex dividend date and on that date fall to where it was before the run-up. This makes trading on the basis of dividends less profitable except for those who hold the stock for the long haul.

 

[jacmyoung]

OK, today's the EX Dividend day which means if you didn't buy in before today you won't get this unprecedented dividend of $2 a share.

DISH stock took a $2 tumble this morning since yesterday's closing of just upwards of $22. But if you got in when the stock was way below $20 and are planning to hold til the stock gets much higher than $22 then this dividend comes as a nice holiday gift surprise. As most stock experts will tell you stocks tend to inflate to the mean share price leading up to the ex dividend date and on that date fall to where it was before the run-up. This makes trading on the basis of dividends less profitable except for those who hold the stock for the long haul.

It has some to do with the news Charlie is no longer CEO of E* company. Personally I think DISH should come down some. The fundamentals hasn't changed that much. One good quarterly number shouldn't drive it up so much. They need several solid quarters.

 

[jacmyoung]

On the other hand I do see your point. You think this news could be timed for the ex dividend date or are you saying the news is not relevant?