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Bull Of The Day: ViaSat (VSAT)

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Viasat (VSAT - Free Report) is a Zacks Rank #1 (Strong Buy) that has a D for Value and a C for Growth and I have seen some broader strength in the satellite space in the last few weeks.  Peers like IRDM, MAXR and others have forced me to take a deeper look at this stock and it is now the Bull Of The Day.

Description

Viasat, Inc. provides broadband and communications products and services worldwide. It operates through three segments: Satellite Services, Commercial Networks, and Government Systems. The company's Satellite Services segment offers satellite-based fixed broadband services, including broadband internet access and voice over internet protocol services to consumers and businesses; in-flight entertainment, internet, and aviation software services to commercial airlines; community internet services; and mobile broadband services, including satellite-based internet services to energy offshore vessels, cruise ships, consumer ferries, and yachts. As of March 31, 2020, this segment provided broadband Internet services to approximately 590,000 subscribers. The company was founded in 1986 and is headquartered in Carlsbad, California.

Earnings History

I see a solid earnings history here with 4 beats in the last 4 quarters. That is really good to see as lately so many names have had issues in the two quarters that were impacted by the pandemic.

Over that time horizon there were three big beats, and one monster beat.  The monster was 3 quarters ago and that skewed the average with its 1100% positive surprise.

The average positive earnings surprise over the last year is 361% but take that one beat out and you have an average of about 100%.

Estimates

Estimates are moving around a good bit for this stock and I expect that to continue.  The main idea here is that this year is looking at a loss of 15 cents while next year flips to a again of 25 cents.  That is a massive swing.

Valuation

With the lack of earnings this year, the forward PE is an NA.  There was a small contraction on the topline of 1.2% in the most recent quarter, but that number still came in well ahead of the expected level.  I see a 1.15x price to book, so that is really good to see.  The 1x price to sales tells me the market does value the sales of VSAT, and I like to see that as well.  Margins have softened up, but clearly they are expected to rise in the coming quarters as revenue is only expected to increase 2.2% this year and 15% next year.

Chart

Viasat Inc. Price, Consensus and EPS Surprise

Viasat Inc. Price, Consensus and EPS Surprise

Viasat Inc. price-consensus-eps-surprise-chart | Viasat Inc. Quote

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