Wall Street Zen Downgrades Telesat (NASDAQ:TSAT) to Strong Sell

Key Points

• Wall Street Zen downgraded Telesat (NASDAQ:TSAT) from a "sell" to a strong sell.
• Analyst sentiment is cautious overall — the stock's average rating is "Reduce" with a consensus target of $37, while Deutsche Bank rates it a hold; fundamentals show a Q1 EPS loss of ($0.97) that beat estimates but revenue of $68.5M missed expectations and net margin is deeply negative.
• Telesat, which is developing the LEO "Lightspeed" constellation, has seen modest buying from institutional investors despite the weak financial metrics.

Telesat (NASDAQ:TSAT - Get Free Report) was downgraded by investment analysts at Wall Street Zen from a "sell" rating to a "strong sell" rating in a report released on Saturday.

TSAT has been the subject of a number of other research reports. Weiss Ratings reaffirmed a "sell (d+)" rating on shares of Telesat in a research report on Wednesday, January 21st. Deutsche Bank Aktiengesellschaft upped their price objective on Telesat from $19.00 to $37.00 and gave the stock a "hold" rating in a research note on Thursday, March 19th. One analyst has rated the stock with a Hold rating and one has given a Sell rating to the company. According to data from MarketBeat.com, the stock currently has an average rating of "Reduce" and a consensus target price of $37.00.

Telesat Price Performance

Shares of TSAT opened at $47.69 on Friday. The company has a debt-to-equity ratio of 0.66, a quick ratio of 0.25 and a current ratio of 0.25. The stock has a 50 day simple moving average of $38.42 and a 200 day simple moving average of $32.47. Telesat has a 52-week low of $14.77 and a 52-week high of $55.69. The firm has a market capitalization of $707.91 million, a PE ratio of -6.31 and a beta of 1.89.

Telesat (NASDAQ:TSAT - Get Free Report) last released its quarterly earnings results on Tuesday, March 17th. The company reported ($0.97) earnings per share for the quarter, topping analysts' consensus estimates of ($1.05) by $0.08. Telesat had a negative return on equity of 1.10% and a negative net margin of 37.25%.The firm had revenue of $68.48 million during the quarter, compared to the consensus estimate of $91.95 million. Sell-side analysts predict that Telesat will post -2.55 EPS for the current fiscal year.

Institutional Investors Weigh In On Telesat

A number of large investors have recently added to or reduced their stakes in TSAT. Royal Bank of Canada raised its stake in Telesat by 32.2% in the 4th quarter. Royal Bank of Canada now owns 2,922 shares of the company's stock valued at $85,000 after acquiring an additional 712 shares during the period. BNP Paribas Financial Markets increased its position in Telesat by 1,335.3% during the 3rd quarter. BNP Paribas Financial Markets now owns 3,818 shares of the company's stock worth $101,000 after buying an additional 3,552 shares during the period. Acadian Asset Management LLC increased its position in Telesat by 63.3% during the 1st quarter. Acadian Asset Management LLC now owns 6,381 shares of the company's stock worth $119,000 after buying an additional 2,473 shares during the period. Virtu Financial LLC bought a new position in Telesat during the 4th quarter worth $211,000. Finally, Quarry LP bought a new position in Telesat during the 3rd quarter worth $212,000.

About Telesat

Telesat is a leading global satellite operator that designs, builds and delivers high-performance satellite communications solutions across multiple markets. The company operates a fleet of geostationary satellites to provide video distribution, data networking and managed broadband services to media companies, network operators, governments and enterprise customers. Telesat's infrastructure supports television distribution, cellular backhaul, rural broadband and corporate network applications.

In addition to its geostationary offerings, Telesat is developing a low Earth orbit (LEO) satellite constellation known as Lightspeed.

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