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Analysts told investors that the company’s Capex profile and increased cost discipline should encourage investors.
“Last week the company provided an update on its plans for the VS-3 F1 Satellite and confirmed that the company does not plan to construct a replacement,” the analysts explained.
“Instead, the next two Viasat-3 satellites (originally for EMEA and APAC, but possibly moving one to Americas) combined with existing infrastructure and agreements should provide ample capacity for Viasat’s planned growth, meaning that the expected $768m in insurance proceeds for VS-3F1 and (most likely) I6-F2 will likely be added to the company’s already large $1.96b cash balance.”
Analysts also noted that Viasat reaffirmed its FY24 financial guidance and guided to EBITDA and revenue growth in 2025. In addition, it provided an FY25 capex range of $1.4-1.5B, which supports JPMorgan’s view that management is now focused on rationalizing capex spend and prioritizing an FCF inflection.
“VSAT shares have sold off ~56% since the 5/31 close of the Inmarsat deal vs SPX +~5%, and we believe the sell-off offers an attractive entry point with the stock now trading at 5.4x our FY25 EBITDA,” they concluded.
