Inmarsat Share Discussion Threads

[steeplejack] 13/2/2018 12:14

Alphaville comment on HSBC downgrade from 570p to 530p target.Because of the high level of capex and inflated opex, Inmarsat's dividend in cash is not covered. It could, however, remain at recent levels if management can demonstrate its confidence in the outlook. We believe a scrip dividend without cash would be artificial but is an option to consider, although it has not said anything on this . A cut is another, even though it would not please investors. If Ligado, the 5G project in the US that pays USD125m pa for ISAT's spectrum, was to consider a suspension of its payments to Inmarsat, we believe Inmarsat would have no other option than to drastically cut the cash dividend (we currently assume stabilityfor the coming years).We would also consider cutting our TP by 100p per share in this scenario. Considering all these risks, we maintain our Hold rating. An update is expected on 9 March (FY17 release).

[zcaprd7] 13/2/2018 11:52

I wish I had the money for a top up, but this is technically very weak with the new low, momentum traders to jump on the band wagon...

[frazboy] 13/2/2018 11:50

there was an update. HSBC released a note (downgrade, obviously). There is some take on this on FT Alphaville for those keen to read.

[the original goldbug] 13/2/2018 11:50

In before Zpcaprd loads up for his SIPP and Alemán attempts a rosey spin on the debt situation.

[wskill] 13/2/2018 11:46

Market leader in Sat Coms maritime market and now going for the same lead in the aviation market very strange this drop today on no news or updates,if ISAT was going to have any change in earnings 3rd Quarter result was 4.6% growth .
And outlook unchanged for the year 2017 and 2018.Results on 9th March picked up a few more at this price I have used a lot of sat comms providers equipment and ISAT is best in class by far.

Will there be an approach at this ridiculous price, probably I would say this is what the algos are leading up to.

[w1ndjammer] 13/2/2018 11:44

A new European Wi-Fi network for airline passengers will be launched by the end of June, the companies behind the project said on Monday.

German telecoms company Deutsche Telekom and communications firm Inmarsat have teamed up to develop the European Aviation Network (EAN).

Combining around 300 base stations across each country of the European Union with a satellite, the project aims to provide smooth broadband coverage over land and water and across the 28 countries of the bloc.

Until now, European carriers have had to rely on satellite-only systems for onboard Wi-Fi across the region.

Deutsche Telekom and Inmarsat also say the EAN equipment is small, lightweight and easy to install, making it suitable for short-haul planes and low-cost carriers.

The launch customer is IAG , which owns British Airways, Iberia, Vueling and Aer Lingus, but it is not clear when exactly its first flights using the EAN will take place.

"Clearly in the next few months we are hoping the first passengers will get to enjoy the service," Frederik van Essen, Senior Vice President at Inmarsat Aviation, told an online press conference

[steeplejack] 13/2/2018 11:27

I know what you are saying but the company has been overpaying on the dividend front and tacitly implied as much when it stated a year back that it was unlikely to grow the dividend further.The debt levels are high,the dividend cover inadequate and when considering income gearing,remember that interest rates are now nudging higher.

Traders stock?I would identify the stock as being a bond proxy stock and unfortunately like some other bond proxy stocks,its likely to prove a disappointment.

[w1ndjammer] 13/2/2018 11:22

is the current yield absurdly high or is the share price absurdly low

over the last 5 years the average share price is 800p

current broker forcasts range between 400p and 1000p

its an easy stock for the traders to play.


WJ.

[steeplejack] 13/2/2018 11:09

The price is telling you that the company is highly likely to cut the dividend otherwise income seekers would be eagerly buying to take advantage of a yield of over 10 %.Of course,perhaps the management are pondering whether they wish to suffer a nasty fall in dividend income from their share holdings.Do you think that is a consideration?

[steeplejack] 13/2/2018 10:56

I see that JPMorgan asset management now have a short position of slightly over half a percent.This company is short of friends.The current yield is absurdly high and the company,given debt levels,has every reason to save money by cutting the dividend in March.Often that proves a turning point.When Aviva cut the dividend some years back,it represented a real turning point.Trouble is though,the market is putting a large question mark over the calibre of the management.

[zcaprd7] 13/2/2018 10:45

It's not always easy to hire the right staff, but strategically, an EU country might be worth the hassle...

[steeplejack] 13/2/2018 10:45

The chart is simply horrid.I guess the ISAT management will be hoping that the GKN bid gets referred establishing a principle that companies involved in defence have a degree of immunity from a good shake up by the likes of Melrose.Frankly,a takeover approach is about the only thing that is going to turn this stock.Its highly unlikely that there is a damascene moment when the City suddenly considers that its misjudged the merits of ISAT.Oh it happens,it happens to builders etc but that reflects the inherent cyclicality of the business as much as anything else.

[wskill] 13/2/2018 10:41

zcaprd7 anywhere else in Europe would be cheaper ,looking at todays trades it only took the algos with tiny trades £400k of sales to drop the share price by 4% .Management may want to put some of the dividend cash to work on a share buyback but I don't suppose in this market it would of any help.

[zcaprd7] 13/2/2018 10:13

Satellite technologies and the far east are usually a bad combination, not worth it to save a few pennies...

[wskill] 13/2/2018 09:36

A reminder of the outlook for ISAT below from 3rd quarter results which grew 4.6% seems undervalued by a country mile to me.
when investment concludes ISAT will have 15 to 20 years of revenue from the infrastructure.

One saving on costs I do see is why is the sat maintenance based in Norway this should be addressed at the first opportunity I could not think of a more expensive country in the world ,
I know there is some legacy issues after the takeover of Ship Equip who were based in Norway but management should move this to a low cost Asian country as there is absolutely no need to maintain this service in the highest cost country in Europe.



Outlook & future guidance

The progress being made in Maritime, Government and Aviation provides confidence about the medium to long term outlook for Inmarsat. However, our markets remain challenging and the outlook continues to be difficult to predict. Inmarsat's performance in 2017 and 2018 will continue to be particularly determined by our results in IFC and in Government, as we outlined in March 2017.

Given the combination of these factors, our guidance is as follows:

-- 2017 revenue guidance, excluding Ligado, narrowed to $1,225m to $1,275m, from $1,200m to $1,300m;
-- 2018 revenue guidance, excluding Ligado, of $1,300m to $1,500m (unchanged);
-- Capex guidance of $500m to $600m per annum for each of 2017 and 2018 (unchanged);
-- Annual GX revenues at a run rate of $500m by the end of 2020 (unchanged); and
-- Leverage (Net debt: EBITDA) to normally remain below 3.5x (unchanged).

As previously highlighted, and as our results for 2017 to date continue to clearly demonstrate, the Group's EBITDA margin is being adversely impacted by the inclusion of additional lower margin service revenues related to IFC, by the cost of investment in IFC market capture and delivery, and by higher central operational delivery costs

[kamitora] 11/2/2018 20:36

Industry bosses urge Britain to get back in the space race

[bluemango] 10/2/2018 17:06

Marshall Wace short back above notifiable 0.50% and reappearance of J.P.Morgan for first time since 2015. Total short 5.21%, up slightly but still well down on peak of over 8% reached before year end.

[andyj] 06/2/2018 13:36

I still think it needs to test £4 before it turns.

[zcaprd7] 06/2/2018 10:14

Nope, one of the few silver linings of a bombed out stock...

[steeplejack] 06/2/2018 10:12

The pressing question is to decide whether to bank some profits in this market storm.Luckily,this thorny conundrum won't be worrying ISAT shareholders :)

[ncnd] 06/2/2018 09:18

At least the drops are affecting every share and not just ISAT.
Hoping this is going to rise afterwards like the phoenix from the ashes.

[w1ndjammer] 05/2/2018 16:25

its just being traded, the chartist over at IG predicted 544 then a pull back
just wish i had sold, would be buying back now.

i didn`t think it would pull back this far, but maybe the general market
has helped it along.

thinking of buying more in the ISA

WJ.

[1fox1] 05/2/2018 15:06

Bought too early at 470p. Does this dog ever turn blue?