Canaccord Genuity starts BlackSky stock with Buy, $12 target

On Thursday, Canaccord Genuity initiated coverage on BlackSky Technology Inc. (NYSE:BKSY), giving the satellite imaging company a Buy rating and setting a price target of $12.00. The new rating comes as BlackSky, currently trading at $7.81 with a market capitalization of $247 million, operates a fleet of 13 commercial Earth Observation satellites, which are capable of collecting electro-optical and short-wave infrared imagery.

The company's technology boasts a resolution of approximately 1 meter, but its latest satellites have enhanced capabilities, capturing very high-resolution imagery ranging from 35cm when directly overhead to 50cm at an angle. This level of detail is on par with military and intelligence satellites, positioning BlackSky as a competitive player in the satellite imagery market.

BlackSky's advanced satellite imagery is sold to a diverse set of clients, including U.S. and international government entities, as well as commercial customers. The company maintains impressive gross profit margins of 73% and generated revenue of $102 million in the last twelve months, with 8% year-over-year growth. The applications of their data are broad, covering defense, intelligence, environmental monitoring, and various industrial uses.

The endorsement from Canaccord Genuity suggests confidence in BlackSky's growth potential and technological capabilities within the satellite imagery sector. The $12.00 price target indicates a positive outlook for the company's stock performance in the market. InvestingPro analysis reveals 15+ additional investment insights and key metrics about BlackSky's financial health and market position.

Investors and market watchers will likely keep a close eye on BlackSky's progress and its ability to capitalize on the growing demand for high-resolution Earth Observation data across multiple industries. According to InvestingPro's Fair Value analysis, the stock appears to be trading near its fair value, with a strong liquidity position reflected in its current ratio of 4.1.

In other recent news, BlackSky Technology Inc. reported its financial performance for the fourth quarter of 2024, achieving total revenue of $102.1 million and marking its first full year of positive adjusted EBITDA at $11.6 million. Despite a revenue miss in the fourth quarter, with $30.4 million reported against expectations of $33.9 million, the company maintained a positive outlook with a projected 30% revenue growth for 2025. Analysts at H.C. Wainwright maintained their Buy rating and a $20.00 price target on BlackSky, attributing the revenue shortfall to tougher comparisons due to one-time events in the previous year. Benchmark analysts also reiterated a Buy rating with a $17.00 price target, highlighting the strategic acquisition of LeoStella and the company's progress in GEN-3 satellite production as key developments.

The successful launch of BlackSky's first Gen-3 satellite in early 2025 has been well-received by customers, with the company planning to expand its constellation with additional satellites throughout the year. BlackSky has recently secured contracts worth over $150 million, indicating strong demand driven by geopolitical instability and a shift towards ownership of satellite constellations. The company has also completed a critical design review with an international defense customer, validating its real-time intelligence capabilities supported by the Gen-3 satellite constellation. These developments reflect BlackSky's strategic positioning in the evolving global intelligence, surveillance, and reconnaissance market.

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