EchoStar Stock Soars on $17 Billion Spectrum Sale to SpaceX

EchoStar (NASDAQ: SATS) stock surged on Monday following the announcement of a major spectrum sale to Elon Musk’s SpaceX. The deal, valued at approximately $17 billion, includes $8.5 billion in cash and marks a significant step for SpaceX’s Starlink satellite network, which provides global broadband services.

EchoStar shares jumped 23% in early trading, reaching $82.42. This continues a remarkable year for the company, with its stock climbing 195% year-to-date. The surge follows another spectrum sale in late August, when EchoStar struck a $23 billion deal with AT&T (T).

As part of the agreement, SpaceX will also cover around $2 billion in cash interest payments on EchoStar’s debt through November 2027. Additionally, EchoStar’s Boost Mobile wireless business will gain access to SpaceX’s satellite-to-mobile phone service, a move that could enhance its offerings.

“We’re so pleased to be doing this transaction with EchoStar as it will advance our mission to end mobile dead zones around the world,” said Gwynne Shotwell, SpaceX’s president, in a press release. “With exclusive spectrum, SpaceX will develop next-generation Starlink Direct to Cell satellites, delivering a step change in performance and expanding coverage for customers globally.”

This deal follows EchoStar’s August agreement with AT&T, where the telecom giant committed to purchasing low-band and mid-band wireless spectrum licenses for $23 billion. That transaction, expected to close in mid-2026, includes 30 MHz of nationwide 3.45 GHz mid-band spectrum and 20 MHz of nationwide 600 MHz low-band spectrum.

Prior to these spectrum sales, EchoStar faced challenges in meeting FCC deadlines to build out a 5G wireless network while managing its debt. The company has also recently ventured into global low Earth orbit (LEO) wideband satellite services, signaling a shift in strategy.

Despite these high-profile deals, EchoStar’s core satellite TV business continues to face subscriber declines. In the June quarter, the company reported a 6% drop in revenue to $3.725 billion, missing Wall Street estimates of $3.829 billion. However, EchoStar added 212,000 wireless subscribers during the quarter, far exceeding consensus estimates of 66,000, bringing its total wireless subscriber base to 1.55 million.

EchoStar’s stock holds an Accumulation/Distribution Rating of B, reflecting moderate institutional buying over the past 13 weeks. Its IBD Composite Rating stands at 69 out of 99, indicating solid but not top-tier growth potential. For context, the best-performing growth stocks typically achieve a Composite Rating of 90 or higher.

With its recent spectrum sales and strategic partnerships, EchoStar appears to be positioning itself for a stronger financial future, even as it navigates challenges in its legacy businesses.

For more information please visit www.echostar.com

The post EchoStar Stock Soars on $17 Billion Spectrum Sale to SpaceX appeared first on PRISM MarketView.

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