Is Dish Network a buy or sell in February?

Written by: Stanko Iliev
January 21, 2021
  • Dish and Nexstar have reached a multi-year distribution agreement recently
  • Dish has increased its revenue in Q3 by 42.9% Y/Y
  • If the price jumps above $35, the next target could be around $40

Dish Network (NASDAQ: DISH) shares have barely moved in 2020 while there’s been a massive rally in a wide range of stocks. Dish has increased its revenue in Q3 by 42.9% Y/Y, and it can still offer strong potential returns for long-term investors.

Fundamental analysis: Dish and Nexstar have reached a multi-year distribution agreement

Dish Network Corporation is an American television provider that also offers mobile wireless service to more than 9 million customers. Dish Network is a stable company with a good position on the market, and according to analysts, this company is positioned to weather the COVID-related storms.

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The company increased its revenue in Q3 by 42.9% Y/Y, and the growth projects will ensure that the numbers will be moving up in the upcoming quarters. Net pay-TV subscribers have increased by more than 116K in Q3, while the retail wireless net subscribers decreased by 212K.

Dish has generated $651 million of free cash flow in Q3, and with a market capitalization of $16.9B, this company is not overvalued. Total profit has increased above expectations in Q3, and Citibank has reiterated its buy rating on Dish Network.

Citibank has assigned a $39 price target, but it is also important to mention that Bank of America has a positive view for wireless carriers. Dish has signed fiber deals with four vendors to supply the 5G network as the company plans to become the fourth major U.S. wireless carrier.

“This announcement marks an important milestone in DISH’s deployment process, adding to our strong roster of the industry-leading tower, radio, software, and now fiber vendors,” said Jeff McSchooler, an executive vice president of wireless operations for Dish Network.

Dish and Nexstar have recently reached a multi-year distribution agreement, and according to this agreement, WGN America will launch on DISH’s streaming service to 164 local television stations across the country. WGN America is Nexstar’s wholly-owned cable network, while the agreement’s financial terms were not disclosed.

Dish Network Corporation shares are currently attractively valued, and this company can still offer strong potential returns for long-term investors.

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Technical analysis: Dish Network shares are still unable to stabilize above the $35 price level

Dish Network Corporation shares have significantly underperformed the broader market in the last several months period. This stock could be a good long-term investment, but investors should also consider that the price could weaken below the current price level in the upcoming weeks.

Data source: tradingview.com

On this chart, I marked significant resistance and support levels. The critical support levels are $30 and $25, $35 and $40 represent the resistance levels. If the price jumps above $35, it would be a signal to buy shares, and we have the open way to $40.

Rising above $40 supports the continuation of the bullish trend, and the next price target could be around $45. On the other side, if the price falls below $30, it would be a firm “sell” signal, and we have the open way to $25.

Summary

Dish Network Corporation is an American television provider and is also attempting to become one of the country’s major wireless carriers. Dish Network is a stable company that can still offer strong potential returns for long-term investors.