EU and US could reach trade deal this weekend - Reuters
On Thursday, shares of Planet Labs (NYSE:PL) experienced notable intraday volatility following the pre-market announcement of a significant seven-year, $230 million contract with an established Asia-Pacific commercial partner. The deal involves the construction and delivery of a fleet of Pelican high-resolution satellites, in addition to providing operational services. The news adds to Planet Labs’ impressive momentum, with the stock showing a 17% gain over the past week and a remarkable 134% return over the last year, according to InvestingPro data.
Cantor Fitzgerald analyst Colin Canfield reaffirmed an Overweight rating and a $6.30 price target on Planet Labs, citing several reasons for a positive outlook on the company’s latest contract. Canfield highlighted the agreement’s potential to position Planet Labs favorably for scaling with key international accounts without compromising on capacity, margin performance, or the ability to offer value-added services. The company maintains impressive gross profit margins of 56% and holds more cash than debt on its balance sheet, demonstrating solid financial management. For deeper insights into Planet Labs’ financial health and additional metrics, check out the comprehensive Pro Research Report available on InvestingPro.
The analyst also pointed out that the deal is likely to provide Planet Labs with significant near-term liquidity, owing to the nature of working capital and capital expenditure funding. Furthermore, Canfield underscored the contract as validation of the maturity of Planet Labs’ Pelican satellite design, which saw its first launch in November 2023.
Despite some confusion among investors regarding Planet Labs’ hardware versus software mix and the implications for future margins, Canfield remains constructive on the stock. He addressed concerns about SpaceX’s Starshield, a perceived competitor, by suggesting that Starshield could actually facilitate market development and lead to more business for Planet Labs, as it serves customers who may not be able to afford or access Starshield’s offerings. With a current market capitalization of $1.66 billion and analyst consensus remaining bullish, Planet Labs shows promising potential. InvestingPro subscribers can access 12 additional investment tips and detailed financial metrics to make more informed investment decisions.
In other recent news, Planet Labs has experienced a series of notable developments. The company’s stock target was upgraded to $6.50 by JMP Securities and to $8 by Needham, reflecting analysts’ confidence in the firm’s growth trajectory. Needham’s upgrade followed Planet Labs’ announcement of a $230 million contract aimed at serving the Asia-Pacific region, which is expected to expedite the deployment of its upcoming Pelican constellation.
Furthermore, Planet Labs secured a multi-year contract with the European Space Agency (ESA), enhancing ESA’s data portfolio with commercial satellite data from Planet. This marks Planet Labs’ inclusion in the Copernicus Contributing Missions, emphasizing the growing role of New Space companies in the global Earth observation market.
In addition, Planet Labs was selected as one of the vendors for the National Geospatial-Intelligence Agency’s (NGA) Luno B commercial data contract, valued at up to $200 million. This indefinite delivery, indefinite quantity contract will enhance the national security community’s access to high-quality commercial geospatial intelligence.
These recent developments highlight Planet Labs’ active role in the expanding geospatial and Earth observation landscape. The company’s strategic initiatives and the analysts’ upgrades reflect a positive outlook on Planet Labs’ future growth.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.