Brean Capital Sees Consistent Strategy Paying Off For TiVo Inc.

In a report published Thursday, Brean Capital analyst Todd Mitchell reiterated a Buy rating and $16.00 price target on TiVo Inc. (NASDAQ: TIVO).

In the report, Brean Capital noted, “TiVo has reinvented itself as a turnkey TV Everywhere (TVE) solution for service providers. In this process TiVo has maintained a premium pricing model and executed on a largely proprietary technology base, running counter to a customer base that wanted to see its suppliers move towards open-source technology and plug-and-play solutions.

"We believe this has cost TiVo market capitalization because it is perceived to limit Tivo's addressable market and, as a result, the company is valued primarily based on business it has already won. In the meantime, TiVo has built an impressive track record for execution. In Europe, TiVo has executed on three platforms, two of which outperformed their competition sufficiently to attract acquisition, and, in the U.S., it has created a template for small cable to remain competitive. We recently spent time with TiVo, its competitors, and its customers in Europe, at IBC in Amsterdam, and with some small operators in the U.S., at SCTE in Denver.

"We remain comfortable with our assertion that TiVo is on the verge of expanding its footprint in Europe and TiVo's own assertion that Tier 2 U.S. deployments are accelerating. Against this backdrop, and in light of its accretive capital structure moves, we are beginning to think that TiVo should be credited with value for business as yet unannounced. We reiterate our Buy rating and $16 price target.”

TiVo Inc. closed on Wednesday at $12.98.