Please don't shoot me, I'm a loyal GSAT long and intend to stay here several years for the big payoff. However, I would honestly appreciate those on this board with intimate knowledge of the satcom business to please share your opinion on the viability of IRDM as a secondary investment in satcom. Their stock seems to have hit bottom and looks like a few bucks could be make there, but not if the company is in trouble. Would appreciate your opinions. Thanks. TJ
Looking for a speculative investment with a high return possibility?
"NewSat’s $600 million satellite could see it join Australia’s largest businesses."
Looks to be a great time to be in the satellite sector.
Many thanks for all of your insights, they are appreciated. My original thought was to hedge a play on the possibility the FCC could deny TLPS because of strong govt. ties to IRDM, which the govt. may wish to protect from competition that would hurt IRDM financially, and I wouldn't put anything past this administration.
After considering all your input, I have decided not to purchase shares of IRDM, but not for any of the reasons discussed or even my original thought. Looking back, IRDM has not exceeded $12/share for 4 years and there's nothing that will likely compel the price that high anytime soon, and I simply won't invest in any stock without the expectation that it will at least double in two years or less. Thanks for helping me make this decision, you are the BEST board out there.
There is a Seeking Alpha article by the contributor Buy the Dip Sell the Rip on Iridium saying that it is a great long investment. I don't disagree with that it is just a matter of when to get in. They really talk up Iridium without acknowledging that Iridiums current constellation is in decline which is evidence by the fact the last several quarters their revenue has declined in the millions each quarter. This is only going to continue until the Iridium Next constellation is launched in 2015. That is if it is launched by 2015.
Iridium's current constellation could really start to fail over night just as Globalstar's did in 2007. If that takes place nobody is going to stick around especially government entities until Iridium fixes it. Just as Globalstar's revenue plummeted in 2007 so will Iridium's which will further depress stock value. Iridium is trading above $6. I don't think I would buy Iridium above $3 a share at this point.
It took Globalstar from 2007 till early 2013 to finally put in place their new constellation. This gives a general idea of how long these things take. Of course Globalstar had earthquakes and a moratorium on sat launches to delay their new constellation so say Iridium is luckier it could still take at least 3 years till their new constellation goes up. Which would put the time frame more in the 2017 range.
good post rico
but everyone keeps saying 1015 for their sats when the most of them are scheduled for launch in 2016 & 2017
o3b's second batch of sats are back in rome to try to fix the anomalies that surfaced in their first batch
so thales had GSAT a couple years behind and now they've got o3b several years behind
even if iridium was on schedule they say they can't do their aireon business till 2018 so that tells you how long it will take "if" on schedule
and while waiting for all this thru 2014 and 2015 things are likely to get real ugly for iridium's pps
I might stick around several (i.e., 3 or more) years with my last 1,000 shares, but I actually plan on being out in under two years with the bulk of my shares when the stock twelve bags from today's closing price
... and I love Globalstar! I'll probably hang onto that last 1,000 shares just for sentimental reasons.
Sentiment: Strong Buy
I am no expert in the satcom business but IRDM needs to put up new satellites (NEXT) and currently they don't have the funds. It will cost them billions. Even if they do get the funds there is a back log on launches. Some say not until 2015 at the earliest. So in the mean time IRDM quality will decrease while GSAT is growing taking market share. Good luck.
Thanks Leo, IRDM has already spent appx. 1.2B towards the 3.0B estimated cost of new sats and has lots of govt. backing, so I feel confident they will get the needed financing. My only reason for considering them is that the NEXT gen sats will greatly improve their ability to add capacity, and they have global coverage, whereas we do not. Lastly, with their political clout from existing and new govt. contracts, could they actually prevail in stopping us from fully utilizing TLPS?
I'm looking at this as more of a hedge to protect my GSAT investment. Is there any IRDM downside that's not already priced into their stock?
Thanks again for your insights.