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Here's Why Investors Should Retain Iridium (IRDM) Stock For Now
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Iridium Communications Inc (IRDM - Free Report) performance is benefiting from its expanding subscriber base driven by the demand for consumer-oriented devices and higher services revenues. The company recently reported better-than-expected second-quarter 2022 results.
Iridium reported earnings of 4 cents per share, beating the Zacks Consensus Estimate of breakeven earnings. The company delivered 3 cents in the prior-year quarter. Quarterly revenues of $174.9 million increased 17% from the year-ago quarter’s levels. The upside can be attributed to higher demand for equipment and new subscriber activations. The top line surpassed the consensus mark by 6.6%.
Driven by the strong quarterly results, the company raised its outlook for 2022. The company expects service revenues to increase between 7% and 9% in 2022 against the earlier guidance of 5-7% growth in 2022. Iridium now expects full-year 2022 OEBITDA between $410 million and $420 million compared with the earlier guidance of $400-$410 million.
Iridium outpaced estimates in all of the trailing four quarters, delivering an earnings surprise of 100%, on average.
Moreover, the company has an impressive Growth Score of A. This style score condenses all the essential metrics from a company’s financial statements to get a true sense of the quality and sustainability of its growth.
Image Source: Zacks Investment Research
Amid the ongoing volatility, Iridium stock has been more resilient compared with the Zacks sub-industry it belongs to. The stock has gained 17.4% in the past year compared with an 9.5% decline of the industry.
IRDM stock is down 7% from its 52-week high level of $48.95 on Sep 7, 2021, making it relatively affordable for investors.
The company also has a share repurchase plan in place. In the last reported quarter, the company repurchased 1 million shares worth $35 million. On Mar 7, 2022, Iridium’s board of directors approved a new share repurchase authorization of an additional $300 million through Dec 31, 2023. As of Jun 30, 2022, the company had $267.5 million under its repurchase authorization.
Strong Fundamentals
Headquartered in McLean, VA, Iridium is a satellite communications company that offers dedicated commercial global voice and data communications. The company delivers reliable and low latency communications services to businesses, consumers, wireline and wireless telecommunications operators and Internet service providers. The company also offers commercial satellite communication services to the U.S. and foreign governments and other non-governmental organizations.
Iridium offers competitive broadband services through its Certus technology. Iridium’s performance is benefiting from its expanding subscriber base driven by the demand for consumer-oriented devices and higher services’ revenues.
Continued momentum in commercial IoT business (particularly personal satellite communications) and broadband business is another tailwind.
However, macroeconomic uncertainty and supply chain disruptions remain major concerns. Stiff competition from regional market suppliers restricts its potential to attract new customers. Higher costs and increased lead time to obtain spectrum licenses added concerns for this Zacks Rank #3 (Hold) stock.
The Zacks Consensus Estimate for BMI’s 2022 earnings is pegged at $2.30 per share, up 7% in the past 60 days. Badger Meter’s earnings beat the Zacks Consensus Estimate in three of the preceding four quarters, the average being 12.6%. Shares of BMI have gained 0.7% of their value in the past year.
The Zacks Consensus Estimate for Arista Networks’ 2022 earnings is pegged at $3.99 per share, up 8.4% in the past 60 days. The long-term earnings growth rate is anticipated to be 18.6%.
ANET earnings beat the Zacks Consensus Estimate in the last four quarters, the average being 10.1%. Shares of ANET have increased 41.2% in the past year.
The Zacks Consensus Estimate for Intuit’s fiscal 2022 earnings is pegged at $11.72 per share, unchanged in the past 60 days. The long-term earnings growth rate is anticipated to be 15.6%.
Intuit’s earnings beat the Zacks Consensus Estimate in three of the last four quarters, the average being 16.8%. Shares of INTU have lost 11.7% in the past year.
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Here's Why Investors Should Retain Iridium (IRDM) Stock For Now
Iridium Communications Inc (IRDM - Free Report) performance is benefiting from its expanding subscriber base driven by the demand for consumer-oriented devices and higher services revenues. The company recently reported better-than-expected second-quarter 2022 results.
Iridium reported earnings of 4 cents per share, beating the Zacks Consensus Estimate of breakeven earnings. The company delivered 3 cents in the prior-year quarter. Quarterly revenues of $174.9 million increased 17% from the year-ago quarter’s levels. The upside can be attributed to higher demand for equipment and new subscriber activations. The top line surpassed the consensus mark by 6.6%.
Driven by the strong quarterly results, the company raised its outlook for 2022. The company expects service revenues to increase between 7% and 9% in 2022 against the earlier guidance of 5-7% growth in 2022. Iridium now expects full-year 2022 OEBITDA between $410 million and $420 million compared with the earlier guidance of $400-$410 million.
Iridium outpaced estimates in all of the trailing four quarters, delivering an earnings surprise of 100%, on average.
Moreover, the company has an impressive Growth Score of A. This style score condenses all the essential metrics from a company’s financial statements to get a true sense of the quality and sustainability of its growth.
Image Source: Zacks Investment Research
Amid the ongoing volatility, Iridium stock has been more resilient compared with the Zacks sub-industry it belongs to. The stock has gained 17.4% in the past year compared with an 9.5% decline of the industry.
IRDM stock is down 7% from its 52-week high level of $48.95 on Sep 7, 2021, making it relatively affordable for investors.
The company also has a share repurchase plan in place. In the last reported quarter, the company repurchased 1 million shares worth $35 million. On Mar 7, 2022, Iridium’s board of directors approved a new share repurchase authorization of an additional $300 million through Dec 31, 2023. As of Jun 30, 2022, the company had $267.5 million under its repurchase authorization.
Strong Fundamentals
Headquartered in McLean, VA, Iridium is a satellite communications company that offers dedicated commercial global voice and data communications. The company delivers reliable and low latency communications services to businesses, consumers, wireline and wireless telecommunications operators and Internet service providers. The company also offers commercial satellite communication services to the U.S. and foreign governments and other non-governmental organizations.
Iridium offers competitive broadband services through its Certus technology. Iridium’s performance is benefiting from its expanding subscriber base driven by the demand for consumer-oriented devices and higher services’ revenues.
Continued momentum in commercial IoT business (particularly personal satellite communications) and broadband business is another tailwind.
However, macroeconomic uncertainty and supply chain disruptions remain major concerns. Stiff competition from regional market suppliers restricts its potential to attract new customers. Higher costs and increased lead time to obtain spectrum licenses added concerns for this Zacks Rank #3 (Hold) stock.
Stocks to Consider
Some better-ranked stocks from the broader technology sector worth consideration are Arista Networks (ANET - Free Report) , Intuit (INTU - Free Report) and Badger Meter (BMI - Free Report) . Arista Networks and Badger Meter sport a Zacks Rank #1 (Strong Buy), while Intuit carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for BMI’s 2022 earnings is pegged at $2.30 per share, up 7% in the past 60 days. Badger Meter’s earnings beat the Zacks Consensus Estimate in three of the preceding four quarters, the average being 12.6%. Shares of BMI have gained 0.7% of their value in the past year.
The Zacks Consensus Estimate for Arista Networks’ 2022 earnings is pegged at $3.99 per share, up 8.4% in the past 60 days. The long-term earnings growth rate is anticipated to be 18.6%.
ANET earnings beat the Zacks Consensus Estimate in the last four quarters, the average being 10.1%. Shares of ANET have increased 41.2% in the past year.
The Zacks Consensus Estimate for Intuit’s fiscal 2022 earnings is pegged at $11.72 per share, unchanged in the past 60 days. The long-term earnings growth rate is anticipated to be 15.6%.
Intuit’s earnings beat the Zacks Consensus Estimate in three of the last four quarters, the average being 16.8%. Shares of INTU have lost 11.7% in the past year.