We are raising our rating to BUY from HOLD and increasing our YE'21 target $10 to $60. We view our new target price as arguably conservative considering the significant upside potential in the DISH greenfield 5G wireless opportunity and to a much lesser extent from the likely inevitable merger with DIRECTV. DISH is in the process of rolling out what we view as a revolutionary cloud-native/software-driven 5G network with key partner AWS (AMZN, N/R) that should allow them/developers/AWS to relatively quickly develop 5G applications/services that have the potential to revolutionize wireless, particularly in enterprise markets. Our view is that the fundamental mistake naysayers make on DISH Wireless is to assume that their main strategy is to be the low cost/low price 4th U.S. wireless provider vs. our view that the most significant upside from DISH's innovative 5G wireless network is leveraging its open hyper flexible quick time to market nature for enterprise markets vs. the telcos closed encumbered networks (with millions of 2G/3G/4G customers and legacy brownfield networks that even TMUS admitted in an April '21 FCC filing will be very difficult to replicate DISH). DISH has less spectrum than its peers, but in our view this is irrelevant, as its peers are not going to be able to offer the type of 5G wireless services/applications that DISH/partners will be able to offer for many years. The proxy that we believe investors will increasingly think of for DISH is the example of TWLO (N/R) that was able to relatively quickly unbundle the telco stack and create unique quick to market software/cloud based products, enhanced by millions of developers, apps easily personalized by companies, mostly usage based pricing and today TWLO is worth nearly $60B. TWLO is something that telcos should have been able to offer but they were encumbered by their legacy closed systems and operating culture.
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