Back to top

Analyst Blog

This page is temporarily not available.  Please check later as it should be available shortly. If you have any questions, please email customer support at or call 800-767-3771 ext.  9339.

Continuous rise in programming costs has compelled the leading satellite TV operators in the U.S., DIRECTV (DTV - Analyst Report) and Dish Network Corp. (DISH - Analyst Report), to hike the service rates from the beginning of next year.

As per a Nomura Equity analyst, DIRECTV’s Entertainment and Premier packs will rise $3 and $5, respectively, from the current value of $55 and $125. On the other hand, Dish Network will raise all the plan rates by $3 to $5 per month, on all its plans except for “America’s Choice 120+” package.

Both Dish Network and DIRECTV will increase its average service costs by 4.4% and 5.5%, respectively as compared to last year’s 3.2% and 16.3% respective hikes. Mounting programming costs coupled with higher penetration of low-cost video streaming companies like Netflix, Inc. (NFLX - Analyst Report) and Hulu have encouraged the price hike.

In the third quarter of 2013, both DIRECTV and Dish Network gained 139,000 and 35,000 pay-TV subscribers, respectively. Additionally, average monthly subscriber churn rates were 1.61% and 1.66%, respectively, a significant improvement from the prior-year quarter.

Unlike Time Warner Cable Inc. (TWC - Analyst Report), both the satellite TV operators witnessed strong subscriber growth even after rate hikes in 2013. So, it was highly anticipated that again these two companies will follow the same strategy. Moreover, we believe that the launch of enhanced TV services by these operators will easily offset any possibility of subscriber loss.

Currently, both DIRECTV and Dish Network have a Zacks Rank #3 (Hold).

Please login to or register to post a comment.

New to Zacks?

Start Here

Zacks Investment Research


Are you a new Zacks Member or a visitor to

Top Zacks Features

Learn more

Start for as little as $4.50 per trade.

My Portfolio Tracker

Is it Time to Sell?

One of the most important steps you can take today is to set up your portfolio tracker on Once you do, you'll be notified of major events affecting your stocks and/or funds with daily email alerts.

More Zacks Resources

Zacks Rank Home - Evaluate your stocks and use the Zacks Rank to eliminate the losers and keep the winners.

Mutual Fund Rank Home - Evaluate your funds with the Mutual Fund Rank for both your personal and retirement funds.

Stock/Mutual Fund Screening - Find better stocks and mutual funds. The ones most likely to beat the market and provide a positive return.

My Portfolio - Track your Portfolio and find out where your stocks/mutual funds stack up with the Zacks Rank.

Zacks #1 Rank Top Movers for Zacks #1 Rank Top Movers

Company Symbol Price %Chg
DIXIE GROUP DXYN 15.84 +7.90%
BOFL HOLDING BOFI 85.30 +4.97%
RAMBUS INC RMBS 12.31 +4.41%
VIPSHOP HOLD VIPS 148.73 +4.35%
NETFLIX INC NFLX 345.74 +4.32%