TiVo shares appear to be discounted: report

Sun Feb 5, 2012 3:29pm EST

Related Topics

(Reuters) - TiVo Inc is trading at a compelling discount and could be a possible acquisition target by Microsoft or Google, Barron's financial newspaper reported on Sunday.

TiVo, whose brand is synonymous with digital video recorders, has turned to litigation to generate revenue from licensing fees as the industry pioneer has struggled to fight competition from low-cost rivals in recent years.

In January, it pocketed $215 million from AT&T to settle a patent infringement dispute. The settlement could bode well for TiVo's lawsuit with Verizon, which is centered around the same patents.

Barron's said the company may one day sue Time Warner Cable, which has more subscribers than AT&T and Verizon.

TiVo added subscribers in the third quarter for the first time in four years, Barron's said. It has signed distribution deals with Virgin Media, a cable company based in Britain, and other operators such as Spain's ONO and DirecTV in the United States.

TiVo's shares closed at $11.23 on Friday. Barron's said the stock is trading significantly below some analysts' price targets of $17 and $18 per share.

The company could fetch a takeover price in the mid-$20s if it was acquired by Microsoft or Google, according to Barron's.

(Reporting By Liana B. Baker; Editing by Maureen Bavdek)

We welcome comments that advance the story through relevant opinion, anecdotes, links and data. If you see a comment that you believe is irrelevant or inappropriate, you can flag it to our editors by using the report abuse links. Views expressed in the comments do not represent those of Reuters. For more information on our comment policy, see http://blogs.reuters.com/fulldisclosure/2010/09/27/toward-a-more-thoughtful-conversation-on-stories/
Comments (1)
aligatorhardt wrote:
TiVo is a device stuck in time. With Netflix and other online libraries, available any time, who needs a TiVo? If you are a cable subscriber, there is very little worth recording, as constantly repeating shows is the norm. I predict sales will continue to fall.

Feb 05, 2012 7:45pm EST  --  Report as abuse
This discussion is now closed. We welcome comments on our articles for a limited period after their publication.