• Barron’s, Wednesday, June 17, 2009 9:30 AM

DirecTV is likely to buy back a lot more stock starting next year -- and will eventually get acquired either by AT&T or Verizon, according to Pali Research analyst Richard Greenfield. Noting that Liberty's John Malone is an investor and not an operator, Greenfield says it is "increasingly hard to imagine DirecTV remaining a stand-alone company."

Fear over the competition from cable is "perennially over done," he says. DirectTV has been able to continuously innovate, with digital channels, DVRs, TiVo interface, HD channels, and remote scheduling. "DirecTV only does one thing, video, and they do it better than others by putting the consumer first."

The company should generate nearly $3 billion in free cash flow in 2010, with essentially no leverage by the end of next year. Greenfield says the company could take itself private over the next five years.

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