Hedge fund Kerrisdale Capital released its much-anticipated report on Dish Network Wednesday, claiming that in the best case the satellite TV company’s wireless spectrum is worth about a third of the value Wall Street has placed on it, and adding that the stock should be trading at less than half its current price.

Kerrisdale has made a living out of short selling stocks, and its Dish positon is no different. The fund raised eyebrows earlier this month when it tweeted that it planned to short Dish stock, a move that caused Dish shares to lose about 13% of their value over several days.

This time the market seemed prepared. Although Dish dipped as low as $46.68 per share in early trading Wednesday (down 1.8%), it has since gained ground, priced at $47.60 each (up 0.13%) by early afternoon.

In its report, Kerrisdale said that Dish’s spectrum, which the market values at about $18.5 billion, is worth $5.65 billion in its base case scenario and just $118 million in the worst-case. Kerrisdale’s argument is that spectrum is not as scarce as Wall Street believes and carriers have other ways to expand capacity, namely by building more cell sites.

With a spectrum value that low, and a rapidly declining satellite TV business, Kerrisdale estimates that Dish stock is worth about $20 per share (vs. the $48 per share target of most analysts) in the best case, and just $8 in the worst-case.  

In the report, Kerrisdale acknowledges that such dramatically lower price targets could be difficult to take. But it said that Dish has been trading on borrowed time for too long.

“Dish’s swagger alone has convinced many that, no matter how much it seems like there’s no real plan, everything will somehow work out anyway,” Kerrisdale said in the report. “But, considered dispassionately, Dish’s current strategic direction was always a dangerous longshot: levering up a slowly decaying business to double and triple down on an illiquid, highly specialized, highly regulated, limited-life, non-cash-flowing asset with only two to three plausible buyers. Dish has outlived many skeptics over the years, but, in investing as in gambling, there’s such a thing as pressing your luck.”

Dish hasn’t changed its position either, issuing an identical statement to the one it released when the Kerrisdale report was a mere rumor. Although the company is in a quiet period around its planned participation in the upcoming broadcast incentive spectrum auction, the company said it would continue running its business as always.

"We understand Kerrisdale is shopping a negative report on Dish and may be shorting our stock in an attempt to make a short-term gain while we are in an FCC-mandated quiet period,” Dish said in the statement. “We will continue to manage the business for the long-term benefit of our shareholders as we have done over the last 35 years.”

Dish Network has emerged as the target of a $100 million fund created to short-sell a single stock that it believes is vastly overvalued.

Kerrisdale Capital Management began raising the money for the fund earlier this year. While the company did not specifically name its target initially, it has said that the fund will focus on a $10 billion company that it believes is worth 60% to 80% less than its current price. Kerrisdale has said it is weeks away from publishing a report that will further detail its position.

Kerrisdale later confirmed via tweet that it was indeed shorting Dish but hasn’t decided to discuss it publicly yet. “When we do, we’ll have a lot to say,” the company said via its twitter account.

Dish, which has a $20 billion market cap, says it is in a government-imposed quiet period because of its planned participation in the upcoming federal broadcast incentive spectrum auction.

In a short sale, a broker would typically lend a block of stock to an investor, who then sells the stock, but agrees to replenish the shares at a later date. A short seller makes his money if during that time frame, the stock loses value, basically pocketing the difference of the price at the time the stock was borrowed and the time it was sold.

Dish Network has been amassing wireless spectrum for years and according to some analysts it is valued at $40 billion or more. The company had a slight set-back last year when some of the licenses won through its purchase of spectrum in the AWS-3 auction via designated entities was rejected by the Federal Communications Commission, which ordered Dish either return the licenses or pay a higher rate. Dish opted to return licenses worth about $3.3 billion.

Dish stock, which was down about 13% between April 28 and May 5 as speculation grew that it was the target of the Kerrisdale fund, rose as much as 6% in early trading Friday to $47 per share. The stock was priced at $45.25 each, up 2.6% ($1.16 per share) at 11 a.m. In a statement, Dish acknowledged that it could be the stock Kerrisdale is planning to short.  

"We understand Kerrisdale is shopping a negative report on Dish and may be shorting our stock in an attempt to make a short-term gain while we are in an FCC-mandated quiet period,” Dish said in the statement. “We will continue to manage the business for the long-term benefit of our shareholders as we have done over the last 35 years.”

Pivotal Research Group CEO and senior media & communications analyst Jeff Wlodarczak said to imply that Dish is worth 60%-to-80% less than its current value is “laughable and frankly naïve.”

Wlodarczak argued that Dish’s spectrum assets are undervalued. He estimated that assuming its core business is worth five times cash flow, its wireless licenses are trading at 75 cents per MHz/POP, compared to the $2.70 per MHz/POP value of spectrum in the AWS-3 auction.   

“If these folks are actually short Dish and they were to hold onto to that short for a couple of years, an admittedly big if, I could see them losing a multiple of that $100 million from current levels,” Wlodarczak said.