This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

Dish Still Has Options on its Plate

NEW YORK (TheStreet) -- In a surprise move Friday, Dish Network (DISH) said it won't continue its pursuit of Sprint (S), even though Chairman Charlie Ergen still had time to submit a new offer to block SoftBank's deal to buy Dish.

Ergen ended an eight-month drama, and may have ended Dish's interest in Clearwire (CLWR), which Sprint has been battling Dish to preserve.

Meanwhile, SoftBank, which last week increased its bid to buy Sprint to $21.6 billion, is the biggest winner here, especially since Sprint's attractiveness was due in part to its stake in Clearwire, which has valuable wireless spectrum.

SoftBank can now enter the U.S. wireless market. CEO Masayoshi Son says the Japanese wireless market has become saturated.

The offer for Sprint, the third largest wireless carrier in the U.S., will be voted upon by shareholders on Tuesday. The deal would give SoftBank 80% of Sprint. Both sides feel that the deal could be closed as early as July. I don't see a scenario where it won't be approved, especially since Sprint's largest shareholder, Paulson & Co., supports the transaction.

Last week, I described Ergen's maneuvering for Sprint and Clearwire as a manner of survival. Now Ergen is admitting that he couldn't keep up with SoftBank's seemingly endless ammunition. But nothing's changed. Ergen still needs to act.

The satellite TV industry like cable, has limited upside. It is still under attack from the emergence of pay TV/entertainment outlets like Netflix (NFLX) and Amazon's (AMZN) Prime. And the sector is getting more crowded with Apple's (AAPL) iTV and possibly Intel (INTC).

What's more, Dish remains in a battle with DirecTV (DTV). Dish trades at a premium to DirecTV, even though DirecTV has done much better in metrics like revenue growth, gross margin and operating margin.

The disparity between Dish's stock and that of DirecTV is more glaring with Dish's mobile broadband strategy now seemingly off the table. Dish investors are left to wonder what Ergen is going to do next to respond in these games of thrones. HBO would be proud.

1 of 2

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
DOW 16,493.37 -69.93 -0.42%
S&P 500 1,925.15 -5.52 -0.29%
NASDAQ 4,352.6390 -17.1340 -0.39%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs