Eutelsat
Note: This is a daily stock update and the information stands true as of 16/05/25, 09:00 CET.
Company Update:
Expert Opinion:
Eutelsat is a turnaround story which is given a potentially new life by the rising tensions in Europe following the Ukraine-Russia war. An efficient satellite network is a strategic asset and this is demonstrated by the renewed interest by many European governments. Our expert is sure the company will nor be let go under and will eventually be rescued by Europe in one way or the other. Yet, he wouldn’t buy the stock. The group doesn’t generate enough cash flow to significantly expand its capabilities. This is too risky a bet to his liking with a potential turnaround unlikely before a couple of years in our opinion.
For daily updates, subscribe to our newsletter and for detailed information, reach out to us at sales@alphavalue.eu
Company Update:
Eutelsat reported Q3 24-25 results where revenues were in line with market expectations at €300.6m.
The double digit growth in connectivity, driven by LEO-enabled solutions compensated for the usual 5% decline in video services.
Guidance 24/25: All financial objectives were confirmed.
However, there were two negative news during the conference call.
1. Eutelsat is implementing EU Regulation 269/2014 concerning the denial of resources to Russian entities, which is being applied to selected media groups by the French regulator ARCOM. Consequently, Eutelsat is removing some channels operated by JSC National Media Group, leading to loss of $16mn annually.
2. The Spring 2025 renewal campaign with US Department of Defense resulted in an estimated renewal rate of less than 50%, below the high rates of previous quarters (70%) due to US government's efforts to cut spending overall.
The new CEO will take over the office from 1st June, 2025 and neither the outgoing CEO nor the incoming CEO were present during the conference call. The market is eagerly waiting for the new strategy.
The company said there has been a lot of interest from many European governments but did not provide details regarding any concrete deal yet. This expectation is driving the stock for now.
Expert Opinion:
Eutelsat is a turnaround story which is given a potentially new life by the rising tensions in Europe following the Ukraine-Russia war. An efficient satellite network is a strategic asset and this is demonstrated by the renewed interest by many European governments. Our expert is sure the company will nor be let go under and will eventually be rescued by Europe in one way or the other. Yet, he wouldn’t buy the stock. The group doesn’t generate enough cash flow to significantly expand its capabilities. This is too risky a bet to his liking with a potential turnaround unlikely before a couple of years in our opinion.
For daily updates, subscribe to our newsletter and for detailed information, reach out to us at sales@alphavalue.eu
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Alphavalue Morning Market Tip
Weak Q1 results but the speculation remains intact.
