Zacks Investment Research Downgrades ViaSat, Inc. (VSAT) to Hold

Zacks Investment Research cut shares of ViaSat, Inc. (NASDAQ:VSAT) from a strong-buy rating to a hold rating in a research note published on Tuesday.

According to Zacks, “ViaSat’s second-quarter fiscal 2018 adjusted earnings beat the Zacks Consensus Estimate by a whopping 250% but fell year over year, hurt by escalating research and development costs, and costs related to the ViaSat-2 service launch activities. High R&D and ramp-up costs remain a major headwind to the company’s margins in the near term. The company recorded terrific growth in government business, which was somewhat offset by contraction in Commercial Networks revenues. Steady growth in in-flight connectivity services, mobile broadband, consumer ARPU gains and cost-reduction initiatives proved conducive to growth. ViaSat shares have outperformed the industry’s average return as well, over the past six months. However, persistent weakness in the Commercial Networks segment, seasonality of demand, strong competition and huge rise in R&D expenses continue to be overhangs for the company’s profitability.”

A number of other equities analysts also recently commented on VSAT. B. Riley restated a buy rating and set a $89.00 price objective on shares of ViaSat in a research report on Monday, August 7th. TheStreet downgraded shares of ViaSat from a b- rating to a c rating in a research report on Wednesday, August 9th. Royal Bank Of Canada set a $50.00 price objective on shares of ViaSat and gave the stock a sell rating in a research report on Tuesday, August 15th. Jefferies Group LLC set a $67.00 price objective on shares of ViaSat and gave the stock a hold rating in a research report on Sunday, September 10th. Finally, Needham & Company LLC upgraded shares of ViaSat from a hold rating to a buy rating and set a $78.00 price objective for the company in a research report on Friday, November 10th. Two research analysts have rated the stock with a sell rating, five have issued a hold rating and eight have assigned a buy rating to the company. The stock currently has an average rating of Hold and an average price target of $74.17.

ViaSat (NASDAQ VSAT) opened at $73.77 on Tuesday. The company has a market cap of $4,300.00, a price-to-earnings ratio of 1,458.00 and a beta of 0.74. The company has a debt-to-equity ratio of 0.37, a quick ratio of 1.71 and a current ratio of 2.26. ViaSat has a 12-month low of $57.75 and a 12-month high of $74.95.

ViaSat (NASDAQ:VSAT) last announced its quarterly earnings data on Wednesday, November 8th. The communications equipment provider reported $0.09 EPS for the quarter, topping the Zacks’ consensus estimate of $0.02 by $0.07. The company had revenue of $393.10 million during the quarter, compared to the consensus estimate of $401.83 million. ViaSat had a negative net margin of 0.75% and a positive return on equity of 0.13%. ViaSat’s quarterly revenue was down 1.5% on a year-over-year basis. During the same quarter in the prior year, the firm earned $0.40 EPS. sell-side analysts expect that ViaSat will post -0.98 earnings per share for the current year.

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In related news, Director Jeffrey M. Nash sold 2,000 shares of the stock in a transaction dated Wednesday, November 15th. The shares were sold at an average price of $72.26, for a total value of $144,520.00. The sale was disclosed in a legal filing with the SEC, which is available through this hyperlink. Also, Director John P. Stenbit sold 700 shares of the stock in a transaction dated Friday, September 1st. The shares were sold at an average price of $63.70, for a total transaction of $44,590.00. Following the completion of the sale, the director now directly owns 8,700 shares in the company, valued at $554,190. The disclosure for this sale can be found here. Over the last three months, insiders sold 123,300 shares of company stock worth $7,802,144. 7.70% of the stock is owned by corporate insiders.

Hedge funds and other institutional investors have recently modified their holdings of the stock. PNC Financial Services Group Inc. grew its stake in ViaSat by 9.0% in the 2nd quarter. PNC Financial Services Group Inc. now owns 1,582 shares of the communications equipment provider’s stock valued at $105,000 after acquiring an additional 131 shares during the last quarter. Zurcher Kantonalbank Zurich Cantonalbank grew its stake in ViaSat by 13.4% in the 2nd quarter. Zurcher Kantonalbank Zurich Cantonalbank now owns 1,822 shares of the communications equipment provider’s stock valued at $121,000 after acquiring an additional 216 shares during the last quarter. Virtu KCG Holdings LLC acquired a new stake in ViaSat in the 2nd quarter valued at about $203,000. Shelton Capital Management acquired a new stake in ViaSat in the 2nd quarter valued at about $206,000. Finally, Balter Liquid Alternatives LLC acquired a new stake in ViaSat in the 2nd quarter valued at about $208,000. 99.26% of the stock is currently owned by hedge funds and other institutional investors.

About ViaSat

ViaSat, Inc is engaged in broadband technologies and services. The Company operates through three segments: satellite services, commercial networks and government systems. The satellite services segment provides satellite-based broadband services to consumers, enterprises, commercial airlines and mobile broadband customers primarily in the United States.

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