Shares of Maxar Technologies (MAXR) jumped on Thursday after earnings for the third quarter, and Analysts on Wall Street showed high interest in the space company's progress in launching key satellites next year.
The company's adjusted Ebitda for the third quarter was $113 million, higher than the average analyst expected of $109.9 million for the factset survey, while revenue was lower than expected — $437 million versus $447.7 million.
But Wall Street's focus has been on progress on Maxar's worldview legion satellite.
Legion is a constellation of the company's six image satellites and is critical for the company to continue to receive contracts from U.S. defense and intelligence agencies. Maxar announced in August that it was delaying the launch of its first two Legion satellites, and the company aims to launch between March and June 2022 — a timeline reiterated in its latest earnings report.
Baird upgraded Maxar's rating from neutral to outperforming the broader market with a price target of $39, a 44 percent upside from the stock's recent closing price.
Baird analyst Peter Arment wrote in a note to the customer: "Given the knowledge of the first launch of legion, the company's risk has been greatly reduced, and the current price provides a safer entry point."
Maxar's stock climbed nearly 18 percent in trading from the previous session's closing price of $27.05.
Baird said its previous neutral rating was "largely due to caution about potential legion further delays, but now the outlook for the first launch is clearer."
JPMorgan chase analyst Seth Seifman rated the stock "overweight" with a price target of $47. He also stressed that the launch of legion is the maxar rally "the most important event".
"We see a clear path to improvement, with strong cash flow generated in 2023, driven largely by the launch of Maxar's worldview legion," Seifman wrote to customers.
This article originated from the Financial Circle Network
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