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Viasat (VSAT) to Power Business Aviation IFC Solutions in Brazil

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Viasat Inc. (VSAT - Free Report) has secured a prime contract for Ka-band satellite in-flight connectivity (IFC) solutions for the business aviation market in Brazil. The improved IFC services will offer enhanced Internet capabilities with best-in-class in-flight entertainment options to entice more customers and will likely contribute to the gradual recovery of the airline industry from the COVID-19 setbacks.

The business aviation market in Brazil is reportedly the third largest in the world and assumes relative importance as the key gateway to Latin American markets. Business aviation is often considered as an economic lifeline for areas with limited options for business transportation and contributes significantly to the local and national economies. With government-friendly policies, the business aviation market in Brazil is likely to witness a healthy growth momentum, benefiting companies like Viasat in the long run.

Viasat will leverage its Ka-band partner satellite – SGDC-1 (Geostationary Satellite for Defense and Strategic Communications) – which is owned by state-owned telecommunications services provider Telebras. This, in turn, will enable business jet fliers to enjoy high-quality Internet connectivity at a speed of more than 20 Mbps for video streaming services and data download.  

Viasat’s Ka-band solutions enable business jet customers to enjoy high-speed Internet connectivity from takeoff to touchdown. It empowers aviation clients to reinforce their IFC investments and helps customers to stay connected with smooth web browsing and streaming services. Equipped with unrivaled speed and quality, Viasat’s Ka-band service has been specifically designed to meet accretive demands of data backed by next-gen business applications. The Ka-band leverages global bandwidth to provide avant-garde Internet service with best-in-market pricing to boost the competitiveness of the business jet market.

The surging popularity of high-engagement IFC solutions has forced leading airline companies to scout for new ways to utilize Viasat’s high-capacity satellite solutions to maximize passenger satisfaction. The company’s impressive bandwidth productivity sets it apart from conventional and lower-yield satellites providers. With an advanced level of Internet connectivity, business jet operators in Brazil will offer customers an opportunity to stream all types of video content and seamlessly access free Wi-Fi aboard on air. This will likely sow the seeds for future entertainment enhancements and personalization on customer seatback screens.

Viasat’s Satellite Services business is progressing well, with key metrics including steady growth of ARPU (average revenue per user) and revenues showing impressive growth. ARPU is growing on the back of solid retail distribution network, which accounts for a growing proportion of high value and high bandwidth subscriber base. Furthermore, the increasing adoption of in-flight Wi-Fi services in commercial aircraft is proving conducive to business growth. Viasat has a competitive advantage in bandwidth economics, global coverage, flexibility and bandwidth allocation, which will likely act as a profit churner.

The stock has gained 62.4% over the past year while the industry has rallied 17.6%.

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Viasat currently sports a Zacks Rank #1 (Strong Buy). Some other top-ranked stocks in the industry are Clearfield, Inc. (CLFD - Free Report) , sporting a Zacks Rank #1, and Motorola Solutions Inc. (MSI - Free Report) and Ubiquiti Inc. (UI - Free Report) , both carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Clearfield delivered a trailing four-quarter earnings surprise of 49%, on average.

Motorola has a long-term earnings growth expectation of 9%. It delivered an earnings surprise of 11.6%, on average, in the trailing four quarters.

Ubiquiti has a long-term earnings growth expectation of 32.9%. It delivered an earnings surprise of 20.5%, on average, in the trailing four quarters.

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