Barclays lifted DISH Network (NASDAQ:DISH) to Equal Weight from Underweight on Wednesday, raising the price target by 100% to $10 per share.
The upgrade follows news on Tuesday that DISH and EchoStar Corporation (NASDAQ:SATS) will merge in an all-stock transaction. DISH also announced earnings on the day and confirmed it is in talks to exercise its option to buy the 800MHz spectrum from T-Mobile (NASDAQ:TMUS).
Barclays analysts told investors in a note that Dish's earnings missed broadly on most headline metrics, but "the Echostar deal and any progress on the TMUS deal are likely bigger catalysts for the stock."
"These steps should eliminate one of the biggest concerns near term: the company's ability to fund upcoming maturities. Based on management comments on the merger call, it also appears that the company's ambitions in wireless are even more modest than their already modest scale," the analysts wrote.
"The new capex guide is even lower than an already low guide which means the network will be just a barebones 'check the box' exercise to maintain spectrum licenses. Therefore, company strategy seems to be just to buy time but if that is deliberate then this is also likely backed up by some more concrete monetization considerations at some point," they added.
Given the backdrop, Barclays sees the stock potentially being a "slow and directionless grind despite the removal of short-term liquidity risks."