DirecTV: Surging Stock Price, Plenty of Potential

In October I wrote a post
about Direct TV (DTV) and said "at $26 shares are fairly
priced...should they dip to $20 again, you have a great buying
opportunity". Well, in Jan. 2008 they did just that and are up 35%
since then. (Latest Transcript)


After recent results,
shares have even more upside. Back in October the gist of my post was
that the scope of HD offerings from Direct TV vs cable would bring in
scores of new customers. Since then, the company has dropped the price
of the HD DVR it sells from $399 to $199, tempting even me to get it.


Then this week it announced the company added 275,000 net U.S. subscribers, well above
analyst expectations of about 180,000, and increased its domestic
subscriber base by 5.2% to 17.1 million.

It also announced a $2.5 billion dollar share repurchase plan (8% of market cap).


There
are other potential earnings drivers down the road, such as a plan for
video-on-demand and and internet over power line that are in testing.
Conveniences of programming your DVR by cell phone or computer also
give customers a wide array of features.


Shares could be bought on the next dip and held for the long term.

Disclosure: Customer only.