As investors are advised every time, ‘shares can go down as well as up’. As journalist Chris Forrester has posted at the Advanced Television infosite, the past 48 hours have not been good for SES and Intelsat.
Both satellite operators have been hurt badly by uncertainties that the proposed reallocation of C-band frequencies over the U.S. might not go their way (see separate story below on 5G ‘nationalization’).
SES, for example, fell by almost €1 on March 6th to €15.61. On March 4th, their share price was €17.87. As yesterday went on, there was some opportunistic buying which helped a modest recovery to €16.10.
Intelsat’s decline was even more marked. A fall of $1, from $18.77 to $17.72, added further anxieties and followed on from the severe crash on March 5th from $21 to $15.79. Intelsat’s fall from grace — or support — from investors has been severe. Back in October 2018, the company's shares were trading in the mid-$30s.
The lack of sentiment is entirely focused on the C-band dilemma. RBC Capital’s note earlier in the week reports that some in the U.S. Congress are favoring a 10 percent sequestration of any profits from the sale of airwaves, and that hasn’t helped confidence. However, RBC’s analyst Wilton Fry did suggest that these low prices represent a “great buying opportunity” and to “ignore the noise and buy the dip”.
As they say, shares can go down as well as up.
Investors who have given SES and Intelsat a hard time should have paid attention to comments made on Monday (March 4) by four of the FCC’s Commissioners.
The Commissioners, two Democratic appointees, Jessica Rosenworcel and Geoffrey Starks, as well as two Republicans, Michael O’Rielly and Brendan Carr, made it clear that any ‘nationalization’ by the Trump administration of the C-band spectrum was not likely.
“It will be the private sector, not some government-mandated network, that’s taking the lead [in 5G],” O’Rielly said Monday during a speaking event at Wiley Rein LLP’s Washington, DC, office. “Such a network will never occur, and I will strenuously object to make sure that it fails and falls by the wayside.”
That unambiguous message seems to counter rumors and gossip emanating from some Trump supporters that could threaten the SES and Intelsat plan.
Commissioner Carr used Twitter to say, “Our plan to secure US leadership in 5G is working. It’s built on smart infrastructure policy, freeing up more spectrum, allowing our private sector to invest (and) compete. Turning heel on this successful, free-market approach through China-like nationalization is a non-starter.”