Shares of TiVo (NASDAQ:
) rallied on Friday, up as much as five percent. Later in the
morning, shares corrected somewhat alongside the broader market,
but remained up on the session.
Goldman Sachs issued a research report
on the company, giving it a Buy rating and a $15 price
Goldman notes, "We view TiVo as a leading vendor well
positioned to target consumers who desire a premium viewing
experience in the digital living room and on mobile devices...we
see a reasonable foundation for management's adjusted EBITDA
profitability goal for FY14 and beyond."
TiVo has been a great performer in 2012, rallying over 40
percent year-to-date. Still, shares have been notably volatile,
hitting a low in the summer near $7.80 before bouncing back to
move up strongly higher.
With the rise of alternative forms of entertainment and
methods of viewing content, TiVo could be an attractive stock.
Although a small player, TiVo's DVR service blends traditional
cable programming with Internet-based alternatives like Netflix
). It also makes it easy for customers to use their mobile
devices as a part of their entertainment complex.
Still, the company faces a lot of competition.
Cable and satellite providers themselves have made inroads on
DVR technology, a sector TiVo used to, for the most part, have a
monopoly on. DISH Network (NASDAQ:
) has even used its DVR -- "The Hopper" -- as a cornerstone in
its sales strategy to attract new customers.
Bigger tech companies have moved into the space as well.
Since releasing the Xbox 360 in 2005, Microsoft (NASDAQ:
) has moved to transform the device from a simple video game
console into a fully featured entertainment device. Likewise,
) new WiiU features enhanced entertainment capabilities focusing
on using the WiiU's tablet controller as an interactive TV
There's also the issue of smart TVs.
) is widely rumored to be working on a smart TV. Any TV offering
from Apple would likely include many of the features that drive
TiVo's subscribers to its service.
Still, TiVo is one of those companies that has long been
rumored as a takeover target. Although there is nothing
substantial to back up these claims, TiVo's DVR patent portfolio
could prove to be attractive in the coming years.
With tech companies now shifting their focus to the living
room, the patent battles that have come to dominate the mobile
world in recent years could soon resurface in the TV realm.
Shares of TiVo traded at $12.70 on Friday.
(c) 2012 Benzinga.com. Benzinga does not provide investment
advice. All rights reserved.