Iridium Communications (NASDAQ:IRDM) Shares Up 6.7% - Time to Buy?

Key Points

• Shares jumped 6.7% to about $40.53 on Thursday on lighter-than-average volume, leaving the stock trading well above analysts' average target price of $27.60.
• Analyst opinions are mixed: the consensus is a Hold (four Buys, two Holds, one Sell) with price targets ranging from $16 (BWS) to $36 (Barclays), and recent target increases from Barclays and Morgan Stanley.
• Recent fundamentals show a slight EPS beat ($0.24 vs. $0.23) but revenue missed and was flat year-over-year; the company trades at a high P/E (~39.3), has a $4.4B market cap, and pays a $0.15 quarterly dividend (≈1.4% yield).

Iridium Communications Inc (NASDAQ:IRDM - Get Free Report)'s stock price shot up 6.7% during trading on Thursday . The stock traded as high as $40.16 and last traded at $40.5260. 921,024 shares changed hands during mid-day trading, a decline of 59% from the average session volume of 2,239,549 shares. The stock had previously closed at $37.99.

Analyst Ratings Changes

Several research firms have commented on IRDM. BWS Financial reiterated a "sell" rating and issued a $16.00 price objective on shares of Iridium Communications in a report on Wednesday. Weiss Ratings upgraded shares of Iridium Communications from a "sell (d+)" rating to a "hold (c-)" rating in a report on Tuesday, March 10th. Barclays upped their price objective on shares of Iridium Communications from $25.00 to $36.00 and gave the company an "overweight" rating in a report on Thursday, April 9th. Finally, Morgan Stanley upped their price objective on shares of Iridium Communications from $24.00 to $26.00 and gave the company an "equal weight" rating in a report on Wednesday, February 18th. Four analysts have rated the stock with a Buy rating, two have given a Hold rating and one has issued a Sell rating to the stock. Based on data from MarketBeat.com, the company has a consensus rating of "Hold" and an average target price of $27.60.

Iridium Communications Price Performance

The company has a quick ratio of 1.82, a current ratio of 2.48 and a debt-to-equity ratio of 3.80. The company's 50 day moving average is $26.34 and its 200 day moving average is $21.02. The firm has a market capitalization of $4.41 billion, a price-to-earnings ratio of 39.34, a P/E/G ratio of 2.44 and a beta of 0.48.

Iridium Communications (NASDAQ:IRDM - Get Free Report) last released its quarterly earnings results on Thursday, February 12th. The technology company reported $0.24 EPS for the quarter, beating the consensus estimate of $0.23 by $0.01. Iridium Communications had a net margin of 13.12% and a return on equity of 24.01%. The business had revenue of $212.94 million for the quarter, compared to the consensus estimate of $219.14 million. During the same period in the prior year, the company posted $0.32 earnings per share. Iridium Communications's revenue was up .0% compared to the same quarter last year. On average, equities research analysts anticipate that Iridium Communications Inc will post 0.89 earnings per share for the current fiscal year.

Iridium Communications Dividend Announcement

The firm also recently declared a quarterly dividend, which was paid on Tuesday, March 31st. Investors of record on Monday, March 16th were paid a $0.15 dividend. The ex-dividend date was Monday, March 16th. This represents a $0.60 annualized dividend and a dividend yield of 1.4%. Iridium Communications's dividend payout ratio is 56.60%.

Insider Activity at Iridium Communications

In related news, CAO Timothy Kapalka sold 3,790 shares of the company's stock in a transaction dated Thursday, April 2nd. The shares were sold at an average price of $31.00, for a total value of $117,490.00. Following the transaction, the chief accounting officer directly owned 47,764 shares in the company, valued at approximately $1,480,684. This represents a 7.35% decrease in their ownership of the stock. The transaction was disclosed in a legal filing with the SEC, which is accessible through this link. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Company insiders own 2.70% of the company's stock.

Institutional Investors Weigh In On Iridium Communications

Large investors have recently bought and sold shares of the company. Quantinno Capital Management LP lifted its position in Iridium Communications by 3.1% in the second quarter. Quantinno Capital Management LP now owns 15,199 shares of the technology company's stock valued at $459,000 after purchasing an additional 461 shares during the last quarter. Empowered Funds LLC lifted its position in Iridium Communications by 4.4% in the fourth quarter. Empowered Funds LLC now owns 11,350 shares of the technology company's stock valued at $197,000 after purchasing an additional 478 shares during the last quarter. Allworth Financial LP lifted its position in Iridium Communications by 11.2% in the fourth quarter. Allworth Financial LP now owns 5,677 shares of the technology company's stock valued at $99,000 after purchasing an additional 572 shares during the last quarter. Quadrant Capital Group LLC lifted its position in Iridium Communications by 107.5% in the fourth quarter. Quadrant Capital Group LLC now owns 1,430 shares of the technology company's stock valued at $25,000 after purchasing an additional 741 shares during the last quarter. Finally, Jones Financial Companies Lllp lifted its position in Iridium Communications by 36.2% in the third quarter. Jones Financial Companies Lllp now owns 3,053 shares of the technology company's stock valued at $54,000 after purchasing an additional 812 shares during the last quarter. 84.36% of the stock is currently owned by institutional investors and hedge funds.

About Iridium Communications

Iridium Communications Inc operates a global satellite communications network that delivers voice and data services across land, sea and air. The company's unique architecture relies on a constellation of 66 low-Earth orbit satellites, enabling real-time connectivity in regions beyond the reach of terrestrial wireless networks. Iridium's core offerings include satellite voice and messaging services, broadband data terminals, push-to-talk (PTT) interoperability and machine-to-machine (M2M) solutions for the Internet of Things (IoT).

Iridium serves a diverse range of markets, including maritime shipping, aviation, government and defense, energy, and enterprise.

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