Simon Flannery, an analyst from Morgan Stanley, maintained the Buy rating on Iridium Communications (IRDM – Research Report). The associated price target is $38.00.
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Simon Flannery has given his Buy rating due to a combination of factors that show promise for Iridium Communications’ future growth and financial health. One key aspect is the momentum in the Direct-to-Device (D2D) market, which has rekindled interest in Iridium’s Commercial IoT business. Despite some concerns about potential disruptions from competitors like Starlink, Iridium’s Commercial IoT revenue has experienced healthy growth, supported by a significant increase in subscribers over the past few years.
Furthermore, Iridium’s capital return strategy is a compelling factor for investors. The company has been proactive in repurchasing shares, with a considerable portion of its market cap still authorized for buybacks. Additionally, their robust free cash flow generation, enhanced by a current capex holiday, strengthens their ability to return capital to shareholders. These elements, together with the company’s strategic initiatives like Project Stardust, position Iridium favorably against its peers.
In another report released on January 24, Cantor Fitzgerald also initiated coverage with a Buy rating on the stock with a $0.00 price target.