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DIRECTV (DTV)



DIRECTV’s (DTV) earnings have been in a strong uptrend in recent years, and Value Line estimates that earnings per share in 2015-2017 could double the 2012 level. This growth will be fuelled in part by substantial share buybacks. The stock sells for a discount to the market multiple,...




DIRECTV’s (DTV) earnings have been in a strong uptrend in recent years, and Value Line estimates that earnings per share in 2015-2017 could double the 2012 level. This growth will be fuelled in part by substantial share buybacks. The stock sells for a discount to the market multiple, and beta is only 0.9.

“The stock has solid price growth persistence of ‘85,’ and acceptable financial strength of B+. We expect DIRECTV to continue to peel off subscribers from cable, since satellite is overall a little cheaper than cable, and is the only choice in some rural areas. (Its satellite competitor, Dish network, is not nearly as attractively priced.) DIRECTV has a lot of room to expand in Latin America, too.

“The stock has dropped to 50, in part because the latest quarter, even though a sharp improvement from last year, showed a sequential decline in subscribers. This is likely to be only a hiccup, and the stock’s three to five year appreciation potential of 105-160 is enticing. We will buy 300 shares of DTV at the market.”

Daniel A. Seiver, The PAD System Report, November 30, 2012

Daniel Alan Seiver is a Professor of Economics (Emeritus) at Miami University (Ohio) where he taught from 1978 to 2005. He is currently a Lecturer in Finance at San Diego State University. Seiver’s academic research has been published in leading economics journals including the American Economic Review (Papers and Proceedings), the International Economic Review, and the Review of Income and Wealth. He is the author of Outsmarting Wall Street (3rd edition, 1994), the basis for the PAD System. Seiver’s comments on financial markets and the economy have been quoted in the New York Times, the Wall Street Journal, Forbes, Fortune, Money, Business Week, and many other financial and online publications. He has been a Guest Market Monitor on the PBS program Nightly Business Report. Seiver received his BA and his PhD in Economics from Yale.