What happened

Analysts dueled over Intelsat's (NYSE:I) intrinsic value last week, with JP Morgan arguing the stock might have "little to no" value at all, while Intelsat bull Raymond James suggested the stock was still a buy.

But that didn't last long.

This morning, in a note covered on TheFly.com, investment banker James suddenly pulled his endorsement of Intelsat stock, which is down 10% as of 12:40 p.m. EST in response.

Glowing red stock arrow trending down

Image source: Getty Images.

So what

What prompted James' rethink? Basically, the analyst went back and re-crunched the numbers laid out in the Federal Communications Commission's (FCC) recent 185-page plan for auctioning off C-band spectrum currently licensed to Intelsat and its fellow members of the C-Ban Alliance.

Working off the FCC's description of about $14 billion in payouts to be split among satellite providers -- out of perhaps $77 billion in total proceeds from the spectrum auction -- James estimated that when all's said and done, Intelsat might reap perhaps $4.852 billion from this auction of its spectrum.

Now what

That sounds like a lot -- until you recall that Intelsat is lugging around a $14 billion load of debt, net of cash on hand. $4.852 billion might chip away at a little of that debt load, but it won't pay it all off.

With Intelsat not looking likely to emerge from this process still with a $9 billion loadstone tied around its neck, the analyst concludes Intelsat stock is close to fairly valued at its current share price of $3 and change, and unlikely to go up very much more.

Agreeing with the analysis, investors are selling Intelsat stock today.