Dish Rewards Shareholders, Stock Pops 5%

Dish Network (NASDAQ:DISH) announced today that it will pay a special non-recurring dividend of $2 per share on December 1st, which has eased the worries of many investors. There was speculation that Dish Network’s Chairman, Charlie Ergen, was looking to invest in or build a wireless network for mobile content, but Bloomberg cites Sanford C. Bernstein & Co. analyst Craig Moffet who believes this dividend proves otherwise. Moffet wrote a note to clients saying “The return of cash to shareholders signals that Ergen isn’t going to hoard cash to build his wireless field of dreams.”

Dish Network (NASDAQ:DISH) purchased Blockbuster LLC, North America Inc. and Terrestar Networks Inc. this year. These purchases have expanded the company’s capability to offer more wireless services. The company also applied for a license waiver from the Federal Communications Commission to build a wireless network in August.

In the third quarter Dish lost 110,000 customers compared to Direct TV’s subscriber gain of 327,000. Bloomberg reports that Dish is trying to change its image of being a low-cost television provider and may be willing to accept a decline in subscriptions and stock price while it makes the transition.

Bloomberg quotes Wunderlich Securities analyst Matthew Harrigan who says, “This is a transitional quarter, and I think Charlie doesn’t particularly care about the stock price. The only way he starts caring is if he goes out and starts trying to do more deals. At some point, the stock price does start to matter again because it affects what he can do in the debt markets as well.” Harrigan lists Dish Network as a “hold” rating.

Here’s how Dish and DirecTV’s stocks closed today:

  • Dish Network Corp. (NASDAQ:DISH): The shares recently traded at $24.66, up $1.18, or 5.03%. Its market capitalization is $11.00 billion. They have traded in a 52-week range of $17.95 to $32.56. Volume today was 9,869,930 shares versus a 3-month average volume of 3,296,680 shares. The company’s trailing P/E is 7.98, while trailing earnings are $3.09 per share. About the company: DISH Network Corp. provides a direct broadcast satellite subscription television service in the United States. Get the most recent company news and stock data here >>
  • DIRECTV (NASDAQ:DTV): The shares recently traded at $45.83, down $0.83, or 1.78%. Its market capitalization is $33.84 billion. They have traded in a 52-week range of $39.12 to $53.40. Volume today was 6,724,247 shares versus a 3-month average volume of 7,453,110 shares. The company’s trailing P/E is 14.29, while trailing earnings are $3.21 per share. About the company: DIRECTV provides digital television entertainment in the United States and Latin America. The Company acquires, promotes, sells and distributes digital entertainment programming via satellite to residential and commercial subscribers. Get the most recent company news and stock data here >>