On Wednesday, Needham, a notable investment firm, adjusted its price target for ViaSat (NASDAQ:VSAT), a global communications company, lowering it to $28 from the previous target of $35. Despite this change, the firm sustained its Buy rating on the company's stock.
ViaSat's fourth fiscal quarter of 2024 results showcased a year-over-year pro-forma revenue increase of 5% and EBITDA that exceeded the consensus, primarily fueled by robust government sales. Nevertheless, the forecast for fiscal year 2025 indicated an expectation of flat year-over-year pro-forma revenue and an EBITDA growth of 3-6%, which falls below the consensus.
This tempered outlook is attributed to heightened competitive pressures within the fixed broadband sector and slower in-flight connectivity installations, the latter being affected by production delays at Boeing (NYSE:BA).
The management team at ViaSat confirmed that despite these challenges, they anticipate capital expenditure synergies with a decrease in spending through fiscal years 2025 and 2026. This projection remains in place even as the company plans to launch eight new satellites over the next three to four years.
ViaSat's performance and future expectations have been closely monitored by investors and market analysts. The company's ability to maintain government sales momentum has been a positive note in its financial reports, providing a buffer against some of the pressures faced in other areas of its business.
InvestingPro Insights
As ViaSat (NASDAQ:VSAT) navigates through its fiscal challenges and strategic satellite launches, real-time data from InvestingPro offers additional context for investors considering the company's stock. ViaSat's market cap stands at approximately $2.36 billion, and the company is trading at a low Price/Book multiple of 0.46 as of the last twelve months leading up to Q3 2024, indicating potential undervaluation relative to its book value. Despite the lack of profitability over the last twelve months, analysts are optimistic about the company's future, expecting net income and sales growth in the current year.
InvestingPro Tips highlight the significant debt burden that ViaSat operates with, which investors should keep in mind. However, it's also worth noting that the company's liquid assets exceed its short-term obligations, providing some financial flexibility. For those interested in a deeper analysis, there are 11 additional InvestingPro Tips available, which can be accessed for ViaSat at https://www.investing.com/pro/VSAT. To enrich your investment strategy, use the coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription.
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