Shares in video-on-demand and ad-insertion-equipment vendor SeaChange
International Inc. surged Monday, following Friday's VOD-output agreement
between Universal Studios and In Demand L.L.C.
SeaChange shares jumped about 12 percent Monday, closing at $24.63 apiece
Some Wall Street analysts have said that one of the key risks with VOD stocks
is the amount of VOD content available to cable operators, which impacts the
amount MSOs will invest in VOD equipment.
In Demand's agreement with Universal marks the company's first output deal
with a major studio. Most of the majors -- including Paramount Pictures, Sony
Pictures and Buena Vista Pictures -- haven't agreed to license their movies for
SeaChange also received some positive comments from Wall Street analysts
recently. On July 12, Adams, Harkness & Hill analyst James Kedersha
initiated coverage on SeaChange with a buy rating, setting a 12-month price
target of $25 per share.