Iridium Communications Intrinsic Value – ARK Investment Management Reduces Stake in Iridium Communications by 5.9% in Q3
November 12, 2024
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IRIDIUM COMMUNICATIONS ($NASDAQ:IRDM) is a global satellite communications company that provides voice and data services to customers around the world. In the third quarter of this year, one of the major shareholders in IRIDIUM COMMUNICATIONS, ARK Investment Management LLC, reduced its stake in the company by 5.9%. This news comes as a surprise to many as the satellite communications industry has been experiencing significant growth in recent years. ARK Investment Management LLC is a well-known investment firm that is focused on disruptive innovation and emerging technologies. The firm’s decision to reduce its stake in IRIDIUM COMMUNICATIONS may raise some questions about the future prospects of the company. Many industries, including aviation and maritime, which heavily rely on satellite communication services, have been significantly affected by the pandemic. This could potentially lead to a decrease in demand for IRIDIUM COMMUNICATIONS’ services and subsequently impact its stock performance. This indicates that the firm still has confidence in the company’s long-term growth potential and its ability to withstand any short-term challenges.
Moreover, IRIDIUM COMMUNICATIONS has continued to innovate and expand its services in recent years. The company recently launched its new satellite broadband service, Iridium Certus, which offers high-speed internet connectivity to customers in remote locations. This new service has the potential to open up new markets and drive further growth for the company. In conclusion, while ARK Investment Management has reduced its stake in IRIDIUM COMMUNICATIONS, it is important to note that the firm remains a significant shareholder. This move may be a reflection of the current market conditions, but it does not diminish the company’s long-term potential. With its innovative services and continued expansion, IRIDIUM COMMUNICATIONS is well-positioned to continue its growth and solidify its position as a leader in the satellite communications industry.
Analysis – Iridium Communications Intrinsic Value
In our analysis of IRIDIUM COMMUNICATIONS, we took a comprehensive look at the company’s current state of well-being. Our team conducted thorough research and utilized our proprietary Valuation Line to determine the fair value of IRIDIUM COMMUNICATIONS’s shares. Based on our calculations, we have determined that the fair value of IRIDIUM COMMUNICATIONS stock is approximately $53.1. However, despite this fair value, the current market price for IRIDIUM COMMUNICATIONS stock is only $29.53. This means that the stock is currently trading at a significant discount of 44.4%. This undervaluation presents a potential opportunity for investors to purchase IRIDIUM COMMUNICATIONS stock at a lower price than its fair value. Our analysis also took into consideration various factors such as the company’s financial performance, market trends, and industry outlook. We have confidence in our calculations and believe that IRIDIUM COMMUNICATIONS has strong potential for growth and success in the future. Overall, our analysis indicates that IRIDIUM COMMUNICATIONS is currently undervalued in the market. We recommend that investors consider this potential opportunity and conduct their own research before making any investment decisions. With its fair value significantly higher than its current trading price, we believe that IRIDIUM COMMUNICATIONS has the potential to provide investors with a strong return on their investment in the long term. More…
About the Company
Income Snapshot
Below shows the total revenue, net income and net margin for Iridium Communications. More…
| Total Revenues | Net Income | Net Margin |
| 790.72 | 15.41 | 1.9% |
Cash Flow Snapshot
Below shows the cash from operations, investing and financing for Iridium Communications. More…
| Operations | Investing | Financing |
| 314.91 | -83.49 | -327.05 |
Balance Sheet Snapshot
Below shows the total assets, liabilities and book value per share for Iridium Communications. More…
| Total Assets | Total Liabilities | Book Value Per Share |
| 2.66k | 1.77k | 7.17 |
Key Ratios Snapshot
Some of the financial key ratios for Iridium Communications are shown below. More…
| 3Y Rev Growth | 3Y Operating Profit Growth | Operating Margin |
| 10.7% | 32.0% | 10.8% |
| FCF Margin | ROE | ROA |
| 30.5% | 5.9% | 2.0% |
Peers
Its main competitors are Telenor ASA, Tata Communications Ltd, and Lumen Technologies Inc. These companies compete in the market for mobile satellite communications services.
– Telenor ASA ($OTCPK:TELNF)
TeleNor ASA is a Norwegian telecommunications company with a market cap of $12.05 billion as of 2022. The company has a return on equity of 38.28%. TeleNor ASA is a leading provider of mobile and fixed communication services in Norway. The company offers a wide range of products and services, including mobile voice and data, fixed line, broadband, TV, and other services. TeleNor ASA is a publicly traded company listed on the Oslo Stock Exchange.
– Tata Communications Ltd ($BSE:500483)
Tata Communications Ltd is a leading provider of digital communications services. The company has a market cap of 349.65B as of 2022 and a return on equity of 186.09%. Tata Communications offers a wide range of services, including voice, data, and video, to customers around the world. The company has a strong presence in both developed and emerging markets, and its products and services are used by major telecommunications operators, enterprises, and governments.
– Lumen Technologies Inc ($NYSE:LUMN)
Lumen Technologies Inc is a provider of digital transformation and network services. The company has a market cap of 6.99B as of 2022 and a return on equity of 20.85%. The company’s products and services include cloud, data center and network infrastructure, as well as digital transformation and application services. Lumen Technologies Inc was formerly known as CenturyLink Inc.
Summary
ARK Investment Management LLC, a notable investment management company, recently reduced its stake in Iridium Communications Inc., a global satellite communications company. This move signals a decrease of 5.9% in the third quarter, indicating a potential lack of confidence in the company’s future performance. This could be a cause for concern for investors, as ARK Investment Management LLC has a strong track record in making successful investment decisions. It is important for investors to closely monitor the situation and consider the possible reasons behind this decision in order to make informed investment decisions related to Iridium Communications Inc.
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