Back to top

Analyst Blog

Grupo Televisa S.A. (TV - Analyst Report), the largest media company in the Spanish speaking world, has to wait till the end of 2011 to know whether its long awaited dream to get a foothold in the lucrative Mexican market will actually become a reality or not. Recently, the head of Mexican telecom regulator “Cofeco” declared that their final decision regarding Televisa’s proposed acquisition of 50% stake of Mexican wireless operator Grupo Iusacell will take longer time than expected.

In April 2011, Televisa decided to purchase half of Iusacell for approximately $1.6 billion. Initially, the deal was expected to get regulatory decision by October 2011. However, Cofeco stated the two entities failed to provide all the technical requirements in proper manner and thus the regulatory decision will be delayed.

After its failed wireless venture in 2010 with NII Holdings Inc. (NIHD - Analyst Report), Televisa is once again eyeing Mexican wireless market through Iusacell. Undoubtedly, an entry into the lucrative Mexican wireless market will open up a strong revenue stream for Televisa. If the deal clears regulatory hurdles, then Televisa-Iusacell combination will become the largest quadruple-play service provider in that country. The merged entity will provide pay-TV (both cable TV and satellite TV), Internet, fixed-line telephony, and wireless communications services. 

Nevertheless, we remain skeptical that the new wireless initiative of Televisa may also face stiff legal hurdles. Televisa controls 70% share of the Mexican pay-TV and satellite TV market, which was primarily attributable to its highly appreciated Spanish language TV contents. Grupo Iusacell is a part of Grupo Salinas, which also controls, TV Azteca. After Televisa, TV Azteca is the second largest pay-TV operator in Mexico.

Earlier in this year, we have seen that the Mexican regulatory authority denied permission to the largest indigenous wireline operator Telefonos de Mexico , controlled by telecom tycoon Carlos Slim, to enter into pay-TV market.

We maintain our long-term Underperform recommendation on Televisa. Currently, it holds a short-term Zacks #5 (Strong Sell) Rank on the stock.

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

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
TRIQUINT SE… TQNT 20.63 +6.34%
RF MICRO DE… RFMD 12.43 +5.65%
VASCO DATA… VDSI 14.84 +5.17%
STRATTEC SE… STRT 81.23 +4.27%
PATTERSON-U… PTEN 34.41 +2.58%