Highbridge Capital is a subsidiary of JPMorgan Asset Management. The fund started with $35 million in 1992 and it now manages $29 billion. The main investors in this fund are institutional investors, public and corporate pension funds, endowments, and high net worth individuals. The fund invests in stocks and derivatives, using strategies like arbitrage, long and short, with a short term view. Following its movement can provide an investment opportunity to make profit in the short term. In its latest 13F filing to the SEC, Highbridge’s top two holdings were Cosan Limited (USA) (NYSE:CZZ) and Dish Network Corp. (NASDAQ:DISH).
As sweet as sugar
It is anticipated that sugarcane crop production in Brazil will increase to 594 million tons in the 2013 season, up from 533 million tons in the previous year. Due to this, the company is expecting 10% rise in sugarcane crushing, from 56.2 million tons last year to 62 million tons this year. This will result in higher sales of sugar, to around 4.3 million tons for the current fiscal year from 3.98 million tons in the previous year.
Cosan Limited (USA) (NYSE:CZZ) is expecting to export 1.02 million tons of sugar in this year. More sugarcane will also result in increased production of ethanol, as sugarcane is a raw material used in the production of ethanol. The company could sell 2.2 billion liters of ethanol, which will result in revenue of $533 million this year.
Benefits from satellite TV
DISH Network Corp. (NASDAQ:DISH)’s satellite TV contributed around 68% of the company’s revenue last year. The company has wide reach in the U.S., and its services are affordable. Dish’s upfront costs in installation are low, and upgrading to high definition (HD) is free for existing customers. These features help the company position its services against its competitors. In addition to a larger potential customer base, the company’s fee per subscriber is expected to increase from $58.3 per month last year to around $61.9 per month next year. Both factors will increase satellite TV revenue from $9.6 billion last year to $10.1 billion next year.
Recently, DISH Network Corp. (NASDAQ:DISH) withdrew from the bidding process for Clearwire Corporation (NASDAQ:CLWR). This will be beneficial for Sprint Nextel Corporation (NYSE:S) which has 51% stake in Clearwire and is willing to pay $5 per share for the remaining 49% stake. Sprint Nextel will gain Clearwire’s spectrum, which will be used for mobile internet. Mobile internet revenue per user of Sprint was around $19.20 per month, which is expected to surge to $23 a month in next year. Increase in mobile internet revenue is expected due to Clearwire’s spectrum. Moreover, with this acquisition, Sprint will gain 130 million Clearwire subscribers in its 4G wireless broadband segment. This will increase future revenue for the company.
It is now rumored that DISH Network Corp. (NASDAQ:DISH) will attempt a merger with T MOBILE US INC (NYSE:TMUS). If this merger takes place, it would give an edge to Dish Network, as it will gain wireless services. T-Mobile has around 42.3 million customers and generates annual revenue of around $21 billion. With this acquisition, Dish Network would enter into the telecommunication segment. Earlier, AT&T Inc. (NYSE:T) tried to acquire T-Mobile U.S., but due to reduced competition concerns from the U.S. regulators, the deal was not finalized. However, regulators wouldn’t raise concerns if Dish Network were to move forward with acquisition, as it is currently a non- telecommunication company.
With this possible acquisition, DISH Network Corp. (NASDAQ:DISH) would become the fourth largest telecommunication company in the U.S. The deal with T-Mobile is lucrative for Dish Network, as T-Mobile possess 4G and 4G LTE networks, which could be used by Dish Network. In the first quarter of 2013, the customer base of T-Mobile grew by 3,000, from a loss of 261,000 subscribers in same period in the previous year. Looking at this opportunity, Dish will ensure its growth by acquiring T-Mobile U.S.
Conclusion
Cosan Limited (USA) (NYSE:CZZ) will expand its business in Europe with the help of its new acquisition, and expected growth of sugar and ethanol sales will lift the revenue of the company. I recommend a buy for this stock. On the other hand, satellite TV subscriber growth and a possible merger with T-Mobile will provide increased opportunity to DISH Network Corp. (NASDAQ:DISH). I recommend a buy on this stock.
Shweta Dubey has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned.
The article It’s Not Too Late to Buy These Companies originally appeared on Fool.com.
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