Not so long ago, satellite internet was the last refuge of the unconnectable; the rural-dweller who had no options, living in the middle of nowhere where no cable or fiber-optic dared to tread. It was poor-quality service that no one wanted unless they had no other choice. But online retail giant Amazon (AMZN) plans to fill in that gap, several months after the expansion of Elon Musk‘s Starlink service. Now, the so-called Project Kuiper is expected to go live by the end of 2025, and shares ticked up fractionally in Tuesday afternoon’s trading.
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Project Kuiper, much like Starlink, is a series of satellites around Earth that provide connectivity, often in places it would never have reached before. Amazon has launched two sets of satellites so far, one in April and a second set in June, reports note.
The market for quality broadband internet access is substantial; Bank of America analyst Justin Post—who has a five-star rating on TipRanks—noted that Amazon may have been cost-cutting in recent months, but the Project Kuiper setup has continued unabated. Post believes that Project Kuiper could ultimately generate $7.1 billion for Amazon by 2032, assuming it gets just 30% of the 2.6 billion people who do not have high-speed access right now.
Then Again, Maybe Not
But one major problem with the Project Kuiper rollout is the weather. Recent reports suggest that the latest launch of Project Kuiper satellites had been under threat, before changes in the weather hit. Down at the Cape Canaveral Space Force station in Florida, the word was “rainy” to describe Tuesday weather. However, the rain looks to be pushing off and opening up good weather for a satellite launch.
Amazingly, Elon Musk’s SpaceX program will be launching its soon-to-be competitor’s satellites skyward. The Falcon 9 rocket expects to have a 27-minute window of good launch conditions that opens at 2:18 a.m. Eastern time, and word from the 45th Weather Squadron says that liftoff conditions have about an 80% chance of turning out well.
Is Amazon a Good Long-Term Investment?
Turning to Wall Street, analysts have a Strong Buy consensus rating on AMZN stock based on 44 Buys and one Hold assigned in the past three months, as indicated by the graphic below. After a 16.93% rally in its share price over the past year, the average AMZN price target of $251.03 per share implies 11.09% upside potential.
