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On Thursday, Needham analysts adjusted their outlook on ViaSat shares (NASDAQ:VSAT), reducing the price target to $16 from $19 while still maintaining a Buy rating. Currently trading at $10.01, the stock has experienced a notable 11.73% decline over the past week, according to InvestingPro data. ViaSat’s fourth fiscal quarter of 2025 results showed a slight increase in revenue, up 1.4% compared to consensus estimates but down 0.3% year-over-year. The company’s adjusted EBITDA fell short by 3% against consensus but increased by 4.8% when adjusted year-over-year.
The performance was influenced by growth in the Government Satellite Communications (Gov’t Satcom) and Digital Airware Technologies (DAT) sectors, which saw increases of 16% and 11% year-over-year, respectively. However, these gains were partially offset by a 9% decline in the Commercial Communications (Commercial Comms) sector. InvestingPro data reveals the company has achieved impressive overall revenue growth of 19.02% over the last twelve months, though operating with a significant debt burden, as highlighted in one of the platform’s key ProTips.
ViaSat’s management has set forth financial guidance for fiscal year 2026, anticipating low single-digit percentage growth in year-over-year revenue and EBITDA levels comparable to the previous year. This forecast falls below the consensus expectations of 4.6% revenue growth and a 1.7% increase in EBITDA.
Analysts attribute the moderated growth projections to the current limitations in satellite capacity, which are expected to persist until the ViaSat-3 (VS3) satellite for the Americas (F3) and the second ViaSat-3 satellite for EMEA (F2) are operational, which is projected for early calendar year 2026. Despite these constraints, ViaSat’s competitive advantages in In-Flight Connectivity (IFC) and Defense Technology are believed to support ongoing growth.
The updated fiscal year 2026 estimates remain largely unchanged, but Needham has introduced their projections for fiscal year 2027. The lowered price target to $16 is based on a sum-of-the-parts (SOTP) valuation method. While currently trading at an attractive Price-to-Book ratio of 0.27, InvestingPro analysis shows the company maintains strong liquidity with current assets exceeding short-term obligations. For deeper insights into ViaSat’s valuation and financial health, investors can access the comprehensive Pro Research Report, available exclusively to InvestingPro subscribers.
In other recent news, ViaSat Inc. reported its fourth-quarter fiscal year 2025 results, exceeding revenue expectations with $1.15 billion compared to the forecasted $1.13 billion. The company also posted a narrower-than-expected earnings per share loss of $0.02, significantly better than the anticipated loss of $0.59. ViaSat’s fiscal year 2025 revenue reached $4.5 billion, although the company faced a GAAP net loss of $575 million. The company generated $900 million in operating cash flow, marking a substantial increase from the previous fiscal year. Looking forward, ViaSat anticipates modest revenue growth for fiscal year 2026, with adjusted EBITDA expected to remain around $1.55 billion. The company plans to focus on debt reduction and aims to enhance free cash flow in the latter half of the fiscal year. ViaSat’s strategic initiatives include the launch of additional ViaSat-three flights and expansion in in-flight and maritime connectivity solutions.
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