We value DISH taking the average of our DCF, FV/EBITDA multiple scenario, and the result of our probability-scenario analysis for the DISH sum-of-the-parts to arrive at our target price of $4.25 (rounded to the nearest $0.25).

Our DCF analysis uses a WACC of 10.5% based on a cost of equity of 10.3% and a pre-tax cost of debt of 14.0%. With long-term FCF declines expected for the DBS business and rising cash flow contributions from its wireless segment, we estimate a terminal multiple on unlevered after-tax cash flow of ~17x. This values the DISH portfolio of assets at $28 billion after adjustments for NOLs of $2.5 billion. We subtract year-end 2024 net debt of $25.8 billion. The resulting equity value is ~$2.3 billion, or $4.23 per share.

We also value DISH using a multiple of 26x consolidated 2025E EBITDA of $1.5B to arrive at a firm value of $26 billion. We expect consolidated EBITDA to grow at a CAGR of 46% between 2025 and 2028. We then deduct 2024E net debt of $27 billion and add back adjustments for NOLs of roughly $2.5 billion to arrive at an equity value of ~$1.5 billion, representing $2.70 per share (using our estimate for 2024 shares to reflect anticipated equity issuance).

We apply a High Risk rating to DISH given its elevated financial leverage and significant funding needs in a higher rate environment.

Risks to our thesis and target price on DISH include: 1) potential loss of spectrum if DISH does not complete its buildout requirements ahead of the FCC deadline and the FCC may ask DISH to return the spectrum to the US government; 2) DISH elects to build out the 5G spectrum without third-party capital, the quality of the network may inhibit third parties from using the network; 3) risks to financing and risk of financial distress if it is unable to refinance upcoming maturities for any reason given it carries high financial leverage; 4) duration risk that the company does not get any closer to operating or monetizing its spectrum assets; 5) DISH video business underperforms and could be relatively more sensitive to an economic downturn or recession in the absence of bundling broadband; 6) our estimate of asset value under the range of scenarios is too optimistic; 7) strategic buyers find alternative assets to DISH, thereby diluting its value and future prospects; 8) financial uncertainty in a build scenario. Possible recession could pose a risk to our estimates and ability for DISH to raise needed capital.

The possibility for DISH to meet funding needs through asset and spectrum sales, announce meaningful wholesale wireless customers, capture strategic investments, and/or sell the company outright could provide positive catalysts for the DISH share price and valuation that cause DISH shares to outperform our outlook on the upside.