We are long shares of Intelsat and SES. Please click here to read full disclosures.
Kerrisdale Capital will host a conference call on Wednesday, February 6 at 11:00am ET to discuss the update report on Intelsat.
To participate in the conference call, dial 866-834-3313 (US) or 409-981-0700 (international) and reference the Kerrisdale Capital call or conference ID 6399586.
With shares 36% below last year’s highs, we believe an investment in Intelsat (NYSE: I) represents exceptional value ahead of important catalysts as the regulatory process enters its final stages. The bull thesis as laid out in our original, full-length report and subsequent Seeking Alpha article, All Systems “Go”, remains unchanged: The C band is extremely valuable spectrum and the C-Band Alliance (“CBA”) holds the keys to unlocking it.
We believe international spectrum auctions suggest the C band is worth substantially more than the $0.21/MHz-pop implied in Intelsat’s current share price. In addition, what makes risk/reward particularly attractive are signs the CBA is winning support from key stakeholders, particularly AT&T, while continuing to lay the groundwork for secondary market agreements with interested parties.
Shares should be pricing in greater conviction on the value of the spectrum and the increasing probability of positive catalysts, not retracing levels visited 6 months ago. Our long-term price objective remains $151 per share.