SATS

[winston]

not vested

SATS LTD – Breakeven in sight and funding clarity to drive re-rating

PSR Recommendation: ACCUMULATE
Status: Initiation
Last Close Price: 2.67
Target Price: 3.020

Funding clarity to reduce overhang on the Company. SATS has provided clarity on its funding structure for the Worldwide Flight Services (WFS) acquisition by committing to a cap of $800mn on the rights issue
We modeled a 3 for 10 rights issue scenario at an issue price of $2.29 (~15% discount to last close) to arrive at a TERP of $2.60.

SATS profitability is at a key inflection point with breakeven in 2HFY23. We expect the Group to turn profitable by FY24e with the resumption of dividend in the same year.

Initiate with ACCUMULATE and a target price of $3.02. Our valuation is pegged to 18.5x FY24e, which is -1sd below its historical average.

Risks to our view include:-
1) Integration challenges for WFS and
2) Revenue growth continuing to lag behind expenses growth.

Source: Phillips

https://www.stocksbnb.com/reports/sats- ... re-rating/

[behappyalways]

Sats shareholders approve WFS acquisition, projected to be completed by April 2023
https://www.theedgesingapore.com/news/m ... april-2023

[behappyalways]

SATS reports 90.2% lower 3QFY2023 earnings of $0.5 mil
https://www.theedgesingapore.com/capita ... ngs-05-mil

[behappyalways]

Sats to launch rights issue priced at $2.20 to fund acquisition of WFS
https://www.theedgesingapore.com/news/e ... sition-wfs

[behappyalways]

The loss was attributable to the one-off expenses of $44.9 million from the merger and acquisition (M&A) of Worldwide Flight Services (WFS).


SATS reports loss of $26.5 mil for FY2022/2023 due to one-off merger and acquisition expenses
https://www.theedgesingapore.com/capita ... n-expenses

[behappyalways]

SATS reports loss of $29.9 mil for 1QFY2024, its first financial statement since WFS acquisition
https://www.theedgesingapore.com/capita ... cquisition

[behappyalways]

SATS’ 1HFY2024 loss of $7.8 million marks 76% improvement y-o-y
https://www.theedgesingapore.com/capita ... ment-y-o-y

[behappyalways]

SATS 3QFY2024 earnings improve by 41.9% q-o-q to $31.5 mil
https://www.theedgesingapore.com/capita ... -q-315-mil

[behappyalways]

Sats sells US military contractor unit, to book net proceeds of US$45.6 million
https://www.theedgesingapore.com/news/a ... 56-million