TiVo (NASDAQ:TIVO) is a San Jose, California based company who develops consumer products and software that allows viewers to watch content across all television screens in and out-of-the home; combining live, recorded, and on-demand television into one intuitive user interface. It also provides leading solutions in television audience research and interactive advertising.
TiVo In The News
TiVo released its second quarter earnings report on August 26th and its results faired okay. The company also announced the release of a new DVR for people without cable subscriptions the day before, on August 25th.
During its Q2 results, TiVo reported $0.08 earnings per share, beating analysts’ consensus estimate of $0.07 by $0.01. During the same quarter last year, the company posted $1.96 earnings per share. TiVo had a profit of $86.60 million for the quarter, compared to analysts’ consensus estimate of $87.72 million. The company’s quarterly revenue was up 12.5% on a year-over-year basis. On Average, analysts expect that TiVo will post $0.28 EPS for the current fiscal year.
One reason for TiVo’s decent quarter is due to the company’s advanced product offering. An example of this is the release of the new version of its Roamio DVR, that is primarily focused on consumers without a television subscription. The new Roamio OTA will be priced starting at $50 at select Best Buy stores starting in September and will only work with an antenna.
A Financial Experts Opinion
On August 27th, Brean Capital analyst Todd Mitchell reiterated a Buy rating for TiVo with a $16 price target. He reasoned, “Gross adds were up year-over-year, and TiVo seems to continue to enjoy strong traction with the Tier-2 U.S. MSO, but with Virgin appearing to scale back somewhat, overall growth appears to have decelerated fairly materially from just last quarter. Simply put, in order to maintain its current valuation, we believe TiVo will need to announce an expansion of its customer base within the next quarter. Management continues to assure investors that this is coming, and independent due diligence points to the likelihood of a deal with a large European MSO. As such, we would view any weakness on the back of F2Q15 results as an opportunity to be more aggressive.” Mitchell has rated TiVo 20 times since 2012, helping him earn a +14.0% average return on the stock.
Mitchell has a history of rating stocks in the television service sector, such as Dish Network (DISH) and DirecTV (DTV), attributing his overall average return of +14.7% and 80% success rate in making recommendations. Mitchell is also ranked #51 out of 3263 financial analysts on TipRanks.
On August 7th of this year, Mitchell reiterated a Buy rating for Dish Network and raised his price target from $62 to $78. He noted, “We believe Sprint abandoning its efforts to bid for T-Mobile is a game changer for DISH. We think that DISH is now in a position to acquire T-Mobile, largely on its own terms, with an acquisition currency supported by the optionality of its spectrum holdings. With its spectrum holdings and T-Mobile’s wireless network and large subscriber base, we think DISH is in the position to significantly enhance its competitive position vis-à-vis the other MVCP providers, while opening up new market segments currently not addressed by the existing MCVP or wireless providers.” Since then, Dish Network has gone up, helping him earn a +21.3% average return on the stock.
On May 19th, Mitchell reiterated a Buy rating for DirecTV with a $95 price target. He explained, “Given our belief that the market has over discounted regulatory risk, and our belief that AT&T will emerge with a much stronger competitive set, which will ultimately bode well for its own share price, we remain buyers of DTV at these levels.” Since then, DirecTV have gone up, helping him earn a +19.0% average return on the stock.
However, Mitchell has not always been so accurate with his recommendations. On June 2 of this year, Mitchell reiterated a Buy rating for SeaChange International (SEAC) with a $14 price target. He noted, “The company continues to maintain that the stars are aligning for a strong ramp in revenue and profits in F2016, but the combination of minimal disclosure of the company’s business segments, an unwillingness to commit to F1Q15 guidance, and poor articulation of the company’s growing opportunity has made it hard for investors to support the stock. However, our independent due diligence confirms the potential for a reversal of fundamental trends in 2HF15, and the potential for dramatically improved results in F2016.” Since then, SeaChange International has gone down, attributing to his -7.0% average return on the stock.
Mitchell enjoys his entertainment given his experience in making successful recommendations for the television service industry. Would you trust his latest recommendation based on his financial advice history?
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Carly Forster writes about stock market news. She can be reached at [email protected]