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Wells Fargo Upgrades ViaSat (VSAT) to Outperform

May 16, 2014 6:52 AM EDT Send to a Friend
Get Alerts VSAT Hot Sheet
Price: $59.36 +1.38%

Rating Summary:
    4 Buy, 9 Hold, 3 Sell

Rating Trend: Up Up

Today's Overall Ratings:
    Up: 0 | Down: 0 | New: 0
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Wells Fargo upgraded ViaSat (NASDAQ: VSAT) from Market Perform to Outperform with a price target of $70-$74 (from $65-$69).

Analyst Andrew Spinola said, "Viasat is one of the best positioned companies in satellite broadband, we think, but the business can be lumpy and sentiment on the stock swings greatly. Following disappointing sub adds last quarter and the low expectations heading into FQ4 results next Tuesday, we believe NT expectations for the business have been adequately reset. Sentiment on the stock was frothy heading into the Loral verdict, touching $75 on March 25, but has reversed since the announcement on April 24 despite Viasat prevailing."

"Sentiment and a lumpy business can create attractive buying opportunities in stocks, and we view this as one of those times for VSAT. The LT story driven by consumer and commercial aviation broadband, innovation in secure Ka-band communications, and substantial operating leverage off a large fixed cost base continues to be bright. We model an EBITDA CAGR of 23% through F18 and think the stock is very attractive at just 9x our F16E EBITDA (year-ending March 2016). Our new valuation range is $70-74, up from $65-69, which is 10-10.5x F16E EBITDA plus $2 for the Loral Verdict," he added.

For an analyst ratings summary and ratings history on ViaSat click here. For more ratings news on ViaSat click here.

Shares of ViaSat closed at $58.99 yesterday.





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