Fixed Satellite Services Sector Undervalued, Report Says

Communications Today, Sept 4, 2002

The limited availability of stock and the presence of non-public companies has kept many investors unaware of the "compelling reasons" to invest in fixed satellite services (FSS) providers, according to a new report from Bear Stearns.

The FSS sector has not been well-followed or understood on Wall Street, explained Bob Peck, Bear Stearns' satellite analyst. However, the "winds of change" are gathering force and FSS soon will emerge center stage as an attractive investment choice, he added. Reasons to invest in FSS, Peck said, include: 1) high barriers to entry; 2) a proven core business that offers bluechip customers, such as multi-channel TV providers; 3) regulation that is driving growth and consolidation; 4) high margins that produce strong cash flow; and 5) the expected growth from rising Internet and broadband services.