Financial Trading Blog
Stock of the day 22/05/2015 – TiVo Inc
Last year ended up being a disappointment for the former tele-revolutionary company, starting 2014 at $13.19 before closing the year at $11.85 after hitting a high of $14.30 at the end of August. The first day of trading in 2015 saw what has so far been TiVo’s year high, a price of $11.96; since then the stock has plunged to between $10.18 and $10.20 multiple times across the last 5 months, its lowest price(s) since November 2012. It is currently trading at $10.69.
(Source: IT-Finance.com 22/05/2015)
The buzz around TiVo at the moment concerns Aereo, the live-TV streaming company that 3 months ago was ruled in breach of copyright law, subsequently going bust. TiVo’s current plan is to create a service like Aereo’s, but crucially one that wouldn’t violate the same laws that led to the now-bankrupt company’s demise. The keenness with which TiVo is following this line of inquiry was shown when the company swooped in, vulture like, and scavenged Aereo’s trademarks, customer list and various intellectual properties for a measly $1 million.
The next step is a bit more inside baseball: to approximate a similar service to Aereo’s, TiVo is bundling together its TiVo Stream (its version of SlingBox) and Roamio OTA (a TV tuner/DVR/Internet set-top box hybrid) and packaging it ‘for free’ if you sign up to its DVR service for $20 a month, a price that undercuts SlingTV AND the various basic cable packages on offer to US customers. If TiVo can attract customers with this move it might be able to inspire a turnaround in its current fortunes.
The start of April saw the company announce its full year earnings for its fiscal 2015, posting a $7.8 million increase in net revenue to $106.33 million, a figure that missed analysts’ forecasts. It also saw its earnings per share surpass expectations, at $0.07 against the $0.04 forecast, whilst adding 324,000 subscribers to take its total to 5.5 million. Despite being less robust than expected, investors were pleased with TiVo’s results, helping the stock spike to $11.92 at the start of March.
For its upcoming quarter, the company is expecting revenue between $90 million and $92 million, net income in a range of $5 million to $7 million and adjusted EBITDA of $26 million to $29 million. Analysts have given TiVo Inc a consensus rating of ‘hold’ with an average target price of $15.19.
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