Intelsat’s share price fell back 12.34 per cent on November 12th, badly hurt by a negative report from investment bank JPMorgan and amid concerns that there are now significant “complications” in how the proposed C-Band Alliance might fare in the long-awaited FCC decision on reassignment of key satellite frequencies.

JPMorgan specifically downgraded Intelsat from ‘Overweight’ to ‘Neutral’ which in itself is not so serious, but the bank states that the prospects for a valuable C-Band spectrum auction is “looking more complicated than it seemed only weeks ago”.

Analyst Philip Cusick has trimmed his price target for Intelsat from $34 a share to $22. November 12th saw Intelsat’s share price close at $20.39, but after-hours took the shares to below $20.

The reduction takes Intelsat’s market capitalisation to below $3 billion.

Cusick says that the complications come from lawmakers on Capitol Hill pushing back on the proposals for a CBA-managed auction in favour of an FCC-organised auction.

The bank adds that the concept that could be a clean win for Intelsat and SES, and possibly Eutelsat, is “less likely” and that at best timing is likely to slow down and could delay the availability of the C-band spectrum coming to market.

There’s also the very real threat that should the FCC decide to administer the auction itself then legal actions mighty follow.

Also not helping matters are differences between the C-Band Alliance (comprising Intelsat, SES and Telesat) and Eutelsat, which withdrew from the Alliance and is now lobbying government on a separate series of proposals including a voluntary 50 per cent payment of ‘windfall’ revenues to the US Treasury.

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