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Telesat Corp (TSE:TSAT)
TSX:TSAT

Telesat Corp (TSAT) AI Stock Analysis

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Telesat Corp

(TSX:TSAT)

Rating:60Neutral
Price Target:
C$34.00
▲(3.79%Upside)
Telesat's overall stock score reflects a mix of strengths and challenges. While technical indicators suggest bullish momentum, financial performance issues, particularly net losses and high leverage, weigh heavily. Positive corporate events and strategic advancements in the LEO segment offer potential upside, but the negative valuation metrics and earnings call concerns about revenue and expenses moderate the outlook.

Telesat Corp (TSAT) vs. iShares MSCI Canada ETF (EWC)

Telesat Corp Business Overview & Revenue Model

Company DescriptionTelesat Corporation, a satellite operator, provides mission-critical communications services to broadcast, enterprise, and consulting customers worldwide. The company's satellite-based services allow direct-to-home (DTH) service providers to deliver television programming, audio, and information channels directly to customers' homes; and enables broadcasters, cable networks, and DTH service providers to transmit television programming services. It offers value-added services, such as satellite capacity, digital encoding of video channels, authorization, and uplinking and downlinking services; and occasional use services for the broadcast of video news, sports, and live event coverages. The company also provides satellite capacity and end-to-end services, including space segment services and terrestrial facilities for enterprise connectivity, and internet and cellular backhaul; and rural telephony to telecommunications carriers and network services integrators. In addition, it offers broadband communication services to maritime and aeronautical markets comprising commercial airplanes and vessels; services to the U.S. government through government service integrators, and satellite services to the Canadian government; and direct-to-consumer broadband services. Further, the company operates satellite and hybrid satellite/terrestrial networks; and communications services for the oil and gas and mining industries. Additionally, it provides satellite operator services; and consulting services related to space and earth segments, government studies, satellite control, and research and development services. The company offers its services primarily through a direct sales force. As of December 31, 2021, it operated a fleet of 14 in-orbit geostationary satellites and a Canadian payload on the ViaSat-1 satellite. The company was founded in 1969 and is headquartered in Ottawa, Canada.
How the Company Makes MoneyTelesat makes money primarily by leasing satellite capacity to various customers, including telecommunications companies, broadcasters, and government agencies. Key revenue streams include long-term contracts for satellite bandwidth, managed services that offer end-to-end network solutions, and consulting services related to satellite operations. Significant partnerships with global telecom operators and technology firms also contribute to Telesat's earnings, enhancing its capability to deliver comprehensive communication solutions across diverse markets.

Telesat Corp Earnings Call Summary

Earnings Call Date:May 06, 2025
(Q1-2025)
|
% Change Since: 47.37%|
Next Earnings Date:Aug 08, 2025
Earnings Call Sentiment Neutral
Telesat's earnings call presented a balanced perspective with significant strategic advancements in the LEO segment, debt management, and strategic partnerships. However, these were offset by revenue declines, increased operating expenses, and ongoing net losses.
Q1-2025 Updates
Positive Updates
Progress in LEO Segment
Telesat made significant progress in its LEO segment, Telesat Lightspeed, with a nearly CAD1.1 billion backlog as of today and a new multiyear agreement with ViaSat.
Debt Repurchase and Interest Savings
Telesat achieved interest savings of approximately USD 54 million annually due to a cumulative principal amount of debt repurchases totaling USD 849 million at a cost of USD 459 million.
Strategic Agreements and Partnerships
Telesat signed a significant multiyear agreement with ViaSat and has strategic agreements with Orange, ADN, and a term sheet with Space Norway.
Cash Flow and Financing
Telesat generated cash from operations of $139 million in Q1 2025 and completed the first two draws on financing facilities with the government of Canada and Quebec, receiving CAD 340 million.
Negative Updates
Revenue Decrease
Telesat's revenues decreased by $25 million to $117 million in Q1 2025 compared to the first quarter of 2024 due to the renewal of a long-term agreement with a North American direct-to-home customer at a lower rate.
Increase in Operating Expenses
Operating expenses increased by $6 million to $53 million, primarily due to increased headcount at Telesat Lightspeed and higher legal and professional fees.
Adjusted EBITDA Decline
Adjusted EBITDA decreased by $43 million to $67 million in Q1 2025, with an adjusted EBITDA margin of 57.7%.
Net Loss
Telesat reported a net loss of $51 million for Q1 2025 compared to a net loss of $52 million for the same period in the prior year.
Company Guidance
During Telesat's conference call to discuss the first quarter 2025 financial results, the company reiterated its guidance for the year. Telesat expects full-year revenues to range from $405 million to $425 million, with total adjusted EBITDA projected between CAD 170 million to CAD 190 million. The company also anticipates operating expenses for Telesat Lightspeed to be between $110 million to $120 million, up from $72 million in 2024. Capital expenditures for 2025 are projected to be between CAD 900 million to CAD 1.1 billion, primarily for Telesat Lightspeed. The guidance assumes a Canadian dollar to US dollar exchange rate of CAD 1.42. Additionally, Telesat ended the first quarter with $797 million in cash and expects to meet its cash requirements with $2.2 billion available under funding agreements with the Canadian and Quebec governments.

Telesat Corp Financial Statement Overview

Summary
Telesat Corp faces significant profitability challenges with consistent net losses impacting its financial health. Despite strong gross margins, operational inefficiencies and high leverage pose risks. Cash flow improvements are promising, but strategic actions are needed to enhance profitability and reduce debt levels.
Income Statement
45
Neutral
The income statement indicates declining revenue over the years, with a revenue drop of approximately 5% TTM compared to the previous year. Gross profit margin is strong at 85.54% TTM, but the net profit margin is negative due to substantial net losses, worsening from -15.36% to -16.52% TTM. EBIT and EBITDA margins also reflect negative figures, indicating operational challenges.
Balance Sheet
55
Neutral
The balance sheet shows a moderate position with a debt-to-equity ratio of 4.73, indicating high leverage. However, the equity ratio is 9.94%, suggesting some financial stability. Return on equity is negative due to net losses, but stockholders' equity has increased slightly in recent periods, showing some resilience.
Cash Flow
50
Neutral
Cash flow analysis reveals a substantial improvement in free cash flow, turning positive in the TTM period. The operating cash flow to net income ratio is 1.42 TTM, indicating strong cash generation relative to net losses. However, the free cash flow to net income ratio is only 0.51, reflecting challenges in converting revenue to free cash flow.
BreakdownTTMDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue535.62M571.04M704.16M759.17M758.21M820.47M
Gross Profit458.18M533.07M665.65M705.16M728.00M787.10M
EBITDA-104.53M67.02M1.14B394.71M626.05M634.74M
Net Income-88.50M-87.72M157.12M-80.12M157.76M244.82M
Balance Sheet
Total Assets7.13B6.95B6.27B6.48B6.37B5.58B
Cash, Cash Equivalents and Short-Term Investments798.06M552.63M1.67B1.68B1.45B818.83M
Total Debt3.35B3.13B3.23B3.85B3.79B3.22B
Total Liabilities4.68B4.45B3.88B4.64B4.67B4.12B
Stockholders Equity708.62M710.28M661.92M480.37M416.52M1.46B
Cash Flow
Free Cash Flow45.48M-2.39M29.58M164.27M260.61M355.35M
Operating Cash Flow125.80M62.46M169.09M228.85M296.39M371.68M
Investing Cash Flow-1.30B-1.09B211.93M74.00K-272.86M-92.23M
Financing Cash Flow164.58M-170.20M-354.65M-104.86M605.24M-450.24M

Telesat Corp Technical Analysis

Technical Analysis Sentiment
Positive
Last Price32.76
Price Trends
50DMA
24.05
Positive
100DMA
25.90
Positive
200DMA
23.05
Positive
Market Momentum
MACD
2.79
Negative
RSI
67.88
Neutral
STOCH
75.97
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:TSAT, the sentiment is Positive. The current price of 32.76 is above the 20-day moving average (MA) of 26.54, above the 50-day MA of 24.05, and above the 200-day MA of 23.05, indicating a bullish trend. The MACD of 2.79 indicates Negative momentum. The RSI at 67.88 is Neutral, neither overbought nor oversold. The STOCH value of 75.97 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TSE:TSAT.

Telesat Corp Peers Comparison

Overall Rating
UnderperformOutperform
Sector (56)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
60
Neutral
$484.69M8.35-12.49%-20.40%-161.60%
56
Neutral
$3.16B4.94-5.68%5.81%7.96%-51.05%
TSCMI
46
Neutral
C$44.37M24.42-4.55%4.76%-41.82%-149.06%
$249.16K
TSVCM
60
Neutral
C$217.62M58.841.61%3.38%9.13%-77.24%
TSNVI
45
Neutral
C$3.01M27.31%-19.37%-772.00%
TSLTE
41
Neutral
C$6.73M
30.25%67.07%
* Technology Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
TSE:TSAT
Telesat Corp
32.76
21.27
185.12%
TSE:CMI
C-Com Satellite Systems
1.05
-0.11
-9.48%
TSE:MMAX
Metamaterial
0.25
-4.75
-95.00%
TSE:LTE
Lite Access Technologies
0.08
0.00
0.00%
TSE:NVI
Novra Technologies
0.09
0.03
50.00%
TSE:VCM
Vecima Networks
8.95
-11.75
-56.76%

Telesat Corp Corporate Events

Shareholder MeetingsBusiness Operations and Strategy
Telesat Corporation Reports 2025 AGM Results, Reinforces Strategic Direction
Positive
Jun 19, 2025

Telesat Corporation announced the results of its 2025 Annual General Meeting, where shareholders approved all business items, including the appointment of Deloitte LLP as auditors and the election of director nominees. This meeting underscores the company’s stable governance and ongoing commitment to its strategic goals, potentially reinforcing its industry position and stakeholder confidence.

The most recent analyst rating on (TSE:TSAT) stock is a Buy with a C$28.00 price target. To see the full list of analyst forecasts on Telesat Corp stock, see the TSE:TSAT Stock Forecast page.

Product-Related AnnouncementsBusiness Operations and Strategy
Telesat Secures Multi-Year Contract with Viasat for Lightspeed Services
Positive
Apr 7, 2025

Telesat has secured a significant multi-year contract with Viasat Inc. to provide Telesat Lightspeed Low Earth Orbit services, which Viasat will integrate into its offerings for aviation, maritime, enterprise, and defense markets. This partnership will enhance Viasat’s broadband connectivity services, allowing thousands of airplanes equipped with Viasat’s technology to access the Telesat Lightspeed network by 2027, and supports Viasat’s network automation goals, positioning Telesat as a key player in the dynamic broadband connectivity market.

Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.Date of analysis: Jun 26, 2025