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Macrovision Upgraded to a Buy

Analyst says the stock looks cheap if its merger with Gemstar-TV Guide doesn't go through.
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SAN FRANCISCO -- Macrovision (MVSN) jumped on an analyst upgrade Thursday.

The stock of Macrovision, which sells software for digital content protection to movie studios and device manufacturers, was up $1.19, or 7.4%, to $17.18 in recent trading.

Jefferies analyst Ross MacMillan upgraded Macrovision to a buy and a one-year price target of $23. Jefferies makes a market in the stock. He said he found some merits to

Macrovision's proposed merger with

Gemstar-TV Guide

(GMST)

.

Immediately after the deal was announced Dec. 10, one sell-side analyst pulled his rating on the company, and another has since dropped coverage. Santa Clara, Calif.-based Macrovision is paying $2.8 billion for Gemstar for its TV listings.

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MacMillan questioned whether shareholders would approve the deal, given each company's stand-alone strengths. "If the deal does happen, we think investors will get paid, but it may take longer," he wrote. "The stock looks very cheap" if the deal does not go through.

News Corp.

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, which owns nearly 41% of Gemstar, has already approved the deal, according to Gemstar.

Macrovision has outlined a post-merger plan to create a digital home dashboard that would be comparable to

Microsoft's

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Media Center, delivering searchable content listings for TV, music and videogames.

Such a platform could be preferred by cable and satellite operators and set-top box makers, MacMillan said.