Originally published: December 7, 2016
Last updated: December 7, 2016 - 1:51pm
Wells Fargo analyst Marci Ryvicker addressed the possibility that the Federal Communications Commission's spectrum incentive auction may fail in a note to investors. “The technical definition of auction failure is concluding Stage 9 (42 MHz cleared/ 20 MHz sold) with the Final Stage Rule still having not been met,” she wrote. “According to our math, we are still quite a ways away from this potential outcome. But with the forward auction going backwards in the two most recent stages, we did feel it time to gauge what might happen to our stocks should the previously unthinkable become our reality.” Her overall conclusions:
- We consider a failed auction more of a disappointment than a thesis changer for our broadcast stocks especially in light of a Republican administration.
- Of the three broadcasters most 'exposed' to the auction, we view Sinclair Broadcast Group as the healthiest regardless and would view Tribune Co. as having the most potential downside risk to its stock price. (Media General is in the middle).
- We particularly like Dish Network's scarcity value.
- We think Comcast's risk/reward profile might actually go UP.
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- Analyst: Political Advertising to Boost TV Coffers by 23%
- Political TV Ad Spending Picking Up After A Slow Start: Analyst
- 29th Annual SNL Kagan TV and Radio Finance Summit
- AT&T predicted to dominate 600 MHz incentive auction with $10B in bids, outshining T-Mobile's $8B spend
- Spectrum Deal Helps Dish Shares
- NBC Retransmission Pays Off For Comcast
- Fisher Sees No Interest in Spectrum Auctions