TiVo's decision Tuesday to cut prices and ramp up promotion of its DVR was interpreted by one analyst as a short-term response to a larger long-term problem.
That was the conclusion of Alan Bezoza, senior VP, Friedman Billings Ramsey (FBR), who reiterated the company's "underperform" rating on shares of TiVo stock.
Essentially, FBR is saying the stock is currently overvalued at $7 dollars a share, valuing it at more like $4, or only a little above its 52-week low of $3.45.
"[We] cannot help but think the move is intended to address slower, stand-alone sub growth as TiVo's business comes under increasing pressure from cable," said Bezoza, who suggested the move might be an effort to boost a traditionally slow quarter, but also said its sales slump might be attributed to a broader strategy of having cut back on marketing expenditures to try to achieve breakeven.
B&C's own John M. Higgins predicted tough times for Tivo in a column last year:(http://www.broadcastingcable.com/article/CA485539.html?display=Search+Results&text=nds).