Viasat Inc. (VSAT - Free Report) recently unveiled a new satellite-enabled Wi-Fi service for cities throughout Mexico — Viasat Urban Wi-Fi. Of late, the company has been working on deploying the high-quality broadband service in Mexico City, with plans to extend the coverage in other cities like Cabo San Lucas, Guadalajara, Guanajuato, Puebla among others by the end of 2019.
The company’s Urban Wi-Fi service has the capability to reach a maximum speed of 100 Mbps, offering a resilient connectivity system during emergencies like natural disaster and national security relief. With the roll out of the service, city residents will gain access to a highly-competitive satellite Internet service with respect to speed, quality and pricing.
The company will leverage the available capacity on its advanced ViaSat-2 satellite system as well as its satellite-enabled hotspot platform to roll out the high-speed broadband Internet service in major cities. As a matter of fact, deployable within few hours, the Viasat Urban Wi-Fi service will enable the company to cater to the increasing connectivity requirements in urban areas with its cost-effective Internet service. Notably, Viasat is already engaged in providing a satellite-enabled Community Wi-Fi hotspot service to more than 1 million citizens across Mexico.
Separately, Viasat and Ubix entered into a strategic collaboration to bring high-speed satellite Internet to businesses and government agencies across Mexico. The deal will involve Ubix to sell, install and provide customer support for the satellite Internet service delivered by Viasat throughout Mexico.
Existing Business Scenario
Viasat maintains a leading position in the satellite and wireless communications market. With the rapid proliferation of the smartphone market and usage of mobile broadband, user demand for coverage speed and quality has increased. This, in turn, is fuelling the demand for network tuning and optimization to maintain high data traffic. Encouragingly, Viasat’s blue-chip customer base, which comprises the U.S. Department of Defense, civil agencies, allied foreign governments, satellite network integrators as well as large communications service providers and enterprises adds to its strength.
The commercial service of ViaSat-2 has helped the company to become the first satellite Internet service provider globally to offer plans with download speeds of up to 100 Mbps. Going forward, Viasat is eyeing opportunities to extend broadband satellite mobility to rotary wing aircraft, as it is a large addressable market that can emerge as a key profit churner. Further, growing adoption of in-flight Wi-Fi services in commercial aircraft is proving conducive to the Satellite Services business’ growth.
In the past three months, this Zacks Rank #3 (Hold) stock has gained 11.7% against the industry’s decline of 8.2%.
However, the company operates in a highly competitive market, which includes stalwarts from varied industries. The company’s Satellite Services segment is affected by seasonality of demand due to traditional retail selling periods. Also, it anticipates incurring huge R&D expenses related to the commercial launch of Viasat-3 satellites.
Some better-ranked stocks in the same space are Ubiquiti Networks, Inc. , Juniper Networks, Inc. (JNPR - Free Report) and Harris Corporation . While Ubiquiti Networks sports a Zacks Rank #1 (Strong Buy), Juniper Networks and Harris carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Ubiquiti Networks surpassed estimates thrice in the trailing four quarters, the average beat being 11.30%.
Juniper Networks exceeded estimates in each of the trailing four quarters, the average beat being 10.99%.
Harris surpassed estimates in each of the trailing four quarters, the average beat being 7.06%.
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