Telesat (TSAT) shares soared 36.3% in the last trading session to close at $54.75. The move was backed by solid volume with far more shares changing hands than in a normal session. This compares to the stock's 13.4% loss over the past four weeks.
The increase in share price can be attributed to increasing demand for Telesat’s Lightspeed network. The company’s subsidiary Telesat LEO ULC recently secured a C$2.3 billion contract with Canada’s Defence Investment Agency to deliver Military Ka-band (Mil-Ka) Arctic connectivity to the Canadian Armed Forces under the Enhanced Satellite Communications Project – Polar (ESCP-P) program.
The total contract value rises to C$2.7 billion, including two optional five-year extensions worth C$200 million each, making it the largest deal in the company’s history, according to the management. The contract duration is 15 years
Further, this contract expands the Lightspeed constellation by adding 69 fully funded satellites, bringing the total to 225. This will be supported by milestone-based government payments starting in the third quarter of 2026.
This deal enhances Telesat’s positioning in the global defense satcom market, particularly across Arctic and allied regions.
This satellite communications company is expected to post quarterly loss of $0.82 per share in its upcoming report, which represents a year-over-year change of -182%. Revenues are expected to be $57.05 million, down 25.6% from the year-ago quarter.
While earnings and revenue growth expectations are important in evaluating the potential strength in a stock, empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements.
For Telesat, the consensus EPS estimate for the quarter has been revised 21% higher over the last 30 days to the current level. And a positive trend in earnings estimate revision usually translates into price appreciation. So, make sure to keep an eye on TSAT going forward to see if this recent jump can turn into more strength down the road.
The stock currently carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>
Telesat belongs to the Zacks Satellite and Communication industry. Another stock from the same industry, Planet Labs PBC (PL), closed the last trading session 6% higher at $22.83. Over the past month, PL has returned -30.2%.
Planet Labs PBC's consensus EPS estimate for the upcoming report has remained unchanged over the past month at -$0.02. Compared to the company's year-ago EPS, this represents a change of +33.3%. Planet Labs PBC currently boasts a Zacks Rank of #4 (Sell).
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This article originally published on Zacks Investment Research (zacks.com).
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
