Deutsche Bank Updates DISH Network Corp Forecast, PT Up $1 (DISH)

Deutsche Bank has issued a research report updating the DISH Network Corp DISH forecast and explaining their recent $1 PT increase. In the report, Deutsche Bank writes "DISH posted much weaker than expected subs in the quarter (-156k vs. our -21k estimate), primarily due to losses from not having the Fox RSNs on the air for a month. At the same time, revenue was slightly ahead ($7m), pre-marketing cash flow nicely ahead ($39m) and EBITDA well ahead ($90m -- partly due to lower gross adds due to dispute). EPS and FCF were also well ahead. We believe our subscriber outlook for 2011 remains reasonable at 175k. This assumes some disruption from the record $5/mo price increase being instituted now, but also very easy 4Q comparisons. Costs have been impressive (4Q sub expenses grew only 2.5% per sub yoy), and we trimmed costs slightly for 2011 as a result." Deutsche Bank goes on to add "Our DCF-based target is raised $1, from $26 to $27, on the higher estimates. It is based on a 9.2% WACC (11.3% cost of equity and 7.2% pre-tax cost of debt) and 0% terminal growth in line with sector." Deutsche Bank maintains their Buy rating for DISH. Shares of DISH closed Wednesday at $22.97.