Share prices for Dish Network parent EchoStar have taken a dive in the days since the company published its second quarterly earnings report, revealing about $2 billion in debt due over the next three months.

Currently, stock for the media giant is trading at $16.23, with overall share price down more than 14% in the past five days.

Before EchoStar reported its earnings Friday, shares for the company were up as high as $20.

Also Read: Dish and Sling TV Revenue Collapses, Down a Record 10% in Q2

That disparity inspired investment banking giant JP Morgan to drop EchoStar’s investment outlook Monday from neutral to underweight.

EchoStar, which closed Q2 with $521 million in cash and cash equivalents, confirmed in its financial results that it does not have the cash to pay off its debts.

However, the company is in discussion with outside parties to compensate for its cash shortage, and is working to refinance its debt obligations.

Also Read: EchoStar Posts Q2 Loss as It Sheds 104,000 Pay TV Subscribers

“We continue to make progress and are in constructive discussions with counterparties, which we feel best support our objective,” Dish CEO Hamid Akhavan told investors on Friday. “The complex and delicate nature of this process demands time and confidentiality. We will certainly have more to share in due course.” 

Akhavan emphasized the use of EchoStar’s spectrum assets, many of which it gained after acquiring Dish Network at the beginning of this year, as a possible point of sale to recover some financial runway.

According to Akhavan, the only reason the company hasn’t used its spectrum assets as collateral is because it has yet to secure a desirable deal.

Veteran analyst Craig Moffett has a less optimistic outlook — according to a report published by MoffettNathanson, he believes that auction dynamics for the company’s spectrum holdings are “unfavorable for a host of reasons.”

Even more, Moffet believes that EchoStar’s shares are “likely to be worthless,” and predicts that the company may see bankruptcy by the end of the year.

 MoffettNathanson LLC, the equities research firm founded by long-time media analysts Craig Moffett and Michael Nathanson, is in talks to be bought out by SVB Leerink, a unit of investment firm SVB Financial Group, according to a Bloomberg News report. The deal is said to be in the very early stages of development and could unravel.  

Moffett, a former media analyst at Bernstein Research, formed Moffett Research in May 2013,  and less than two months later added former Nomura Securities and Bernstein colleague Michael Nathanson to the masthead. The firm quickly established a reputation for insightful analysis in the media, communications and internet sectors and in 2018 expanded into the payments and processing space led by former Bernstein analyst and MoffettNathanson partner Lisa Ellis.

Buying MoffettNathanson would be a departure for SVB Leerink, which has focused on the healthcare industry in the past. But the firm has been expanding its horizons lately, hiring nine former UBS Group investment bankers in May to populate its newly former technology investment banking group. 

Moffett declined to comment. SVB did not immediately respond to a request for comment.

After a brief lull in 2017, overall broadband subscriber additions bounced back in the fourth quarter, largely due to a spike in new household formation, according to MoffettNathanson principal and senior analyst Craig Moffett.

According to Moffett, total net broadband additions in Q4 were 724,000, slightly above the 693,000 additions in the same period in 2017. Cable operators added 841,000 broadband customers, slightly above the 832,000 additions in Q4 2017. Telephone companies lost 145,000 broadband subscribers in the most recent period, an improvement over the loss of 195,000 customers in the prior year.

For the full year, the industry added about 2.8 million broadband connections in 2018. Cable operators added about 3.3 million broadband customers for the full year, offset by a telco loss of about 460,000 customers in the period.

According to Moffett, at the end of 2018 industry growth was running 30 basis points faster than the year before, especially surprising given high penetration rates.

Overall broadband growth was 2.9% in Q4, ahead of 2.6% growth in the same period in 2017, when net additions began to slow. While the pace is still behind 2016, when overall growth was at 3.3%, the increase is encouraging.

New household formation was a big factor in the turnaround. Moffett noted that new household growth accounted for 44% of industry net additions in 2018, compared to just 24% of net additions in 2016.

The analyst warned that broadband penetration growth continues to slow -- it was about 80% in 2018, up slightly from the year before. And he noted that with new household formation playing a big role, “investors should be aware that growth now owes to a macro factor. That being the case, in the event of a recession, industry results would very likely prove more cyclical than has been the case in the past.” 

MoffettNathanson principal and senior analyst Craig Moffett raised his rating on the cable sector to “overweight” on Wednesday, citing the sector’s improved basic-video subscriber performance even as cord-cutting continue to chip away at the overall pay TV customer base.

“Time heals all wounds,” Moffett wrote in a recent report to clients.

In a 35-page report, Moffett wrote that despite the true emergence of cord cutting – he says they are now “front and center” – cable has turned in some of its best subscriber performance in years, dramatically slashing losses.

“Cable isn’t just holding its own, it is dramatically improving video even as the sector has trended down” Moffett wrote.

Moffett said declines in the satellite sector – especially at DirecTV – and the loss of telco TV subscribers in the second quarter also bolster the case for cable. But he added that he does not expect the competition to take it lying down.

Already AT&T has announced some aggressive promotions and Moffett expects that to continue and then-some to help the phone giant justify its recent purchase of DirecTV.

“Still, Cable’s advantages are becoming clearer even as sector contraction accelerates,” Moffett wrote.

As far as individual companies, Moffett raised his rating on Charter and Comcast to “buy,” with a 12-month price target of $210 and $67 per share, respectively. Moffett also maintained his “neutral” on Time Warner Cable ($204) and Cable One ($380), and kept his “sell” on Cablevision Systems ($9).

Influential media analyst Craig Moffett, principal and senior analyst at MoffettNathanson, lowered his ratings on three top cable distribution stocks (Comcast, Time Warner Cable and Charter) to ‘neutral’ on Tuesday, citing the threat of price regulation tied to Title II reclassification of broadband and the increased possibility that regulators reject the Comcast-Time Warner Cable merger as hurdles that are too big to ignore.

Moffett has warned about the looming threat of pricing regulation with Title II for months, and though the stocks have stayed stable, perhaps in the thought that a Republican Congress will tamp down any pricing strictures, Moffett is not convinced.

“It would be naïve to suggest that the implication of Title II, particularly when viewed in the context of the FCC’s repeated findings that the broadband market is non-competitive, doesn’t introduce a real risk of price regulation,” Moffett wrote. “Not tomorrow, of course, so yes, near term numbers won’t change. But terminal growth rate assumptions need to be lowered. Multiples will have to come down.”

Moffett, who in the past gave the Comcast-TWC deal a 70-30 chance of winning approval, dropped those odds to 60-40 on Tuesday, citing increasingly negative sentiment in the press and federal moves to raise the minimum speed classification for broadband to 25 Megabits per second.

“Mostly, however, our downgrade is simply a matter of a sector that has priced in a awful lot of good news and very little bad,” Moffett wrote. “After a strong rally in the face of mounting headwinds, Comcast is now just 1% below our target prices, and Charter just 11%. We believe it is time to reduce exposure.”

Removing broadband pricing flexibility also could exacerbate other factors that are weighing on the indstry, he added.

"Worsening viewership and advertising trends are driving programmers to break ranks both with each other and with their legacy distributors," Moffett wrote. "In the past, changes to broadband pricing would have been the natural remedy. That avenue may be no longer open."

The stocks reacted tepidly to the downgrade, with Comcast closing at $58.80, down about 1.1% (67 cents each). Charter finished Feb. 17 down 0.8% ($1.43) to $176.45 and Time Warner Cable fell 1,4% ($2.06) to $147.68 each.