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Globalstar Initiated Buy as B. Riley Sees Return Potential

'Globalstar and its sponsors ... are at long last starting to realize a return on satellite system assets,' B. Riley said, initiating the stock at buy.
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Globalstar  (GSAT) - Get Globalstar Inc. Report shares jumped on Monday after B. Riley began coverage of the mobile satellite services company with a buy rating and a price target of $3.25.

The Covington, La., company "and its sponsors, after years of development, support, and patience, are at long last starting to realize a return on satellite system and spectrum assets,” said B. Riley analyst Mike Crawford.

That “makes 2021 an excellent time to buy GSAT before the market digests this change.”

The stock recently traded at $1.51, up 17%. It has more than quadrupled (up 371%) over the past six months amid explosive demand for mobile data.

“We believe many investors perceive GSAT as a long-suffering, over-leveraged mobile satellite services provider with spectrum assets that have been difficult to monetize,” Crawford said.

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“In contrast, our investment thesis is that Globalstar has moved through the high-risk portion of its history and is now poised to start generating returns on its hard-fought terrestrial spectrum authorization.”

In other telecommunications-related news, the dividend-growth investor Ferdi Scheepers gave the thumbs up to Verizon  (VZ) - Get Verizon Communications Inc. Report in a June 10 analysis on

“VZ offers a robust yield of 4.38% and so is appropriate for income investors. The stock is available at a slight discount to my fair-value estimate,” Scheepers said.

“Don’t expect fireworks from this company, though. It is growing earnings at a very modest rate.”

Meanwhile, in May, T-Mobile US  (TMUS) - Get T-Mobile US Inc. Report reported stronger-than-expected earnings and raised 2021 guidance on strong demand driven by coronavirus lockdowns in the first quarter.

Revenue registered $19.76 billion, up 78% from $11.11 billion in the year-ago quarter. The FactSet analyst consensus called for $18.73 billion.