DirectTV, EchoStar Enjoy Free Cash Flow Growth

Cowen’s Tom Watts yesterday raised his ratings on shares of both DirecTV (DTV) and EchoStar (DISH) to Neutral from Underperform. He’s hardly turned bullish on the two stocks, but he’s certainly less negative, stressing the companies ability to generate free cash.

Watts says the competitive threat from the telcos move into video remains “substantial,” but he says that “cash flow growth potential…combined with re-capitalization possibilities, can offset the competitive risks in the near-term, supporting the stocks near their current levels.”

DirecTV yesterday was up 14 cents at $24.11, while Echostar was up 34 cents at $47.25.

DISH vs. DTV 1-yr chart