Iridium Q3 FY12/24 Earnings Review

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Aging Gracefully

by Alex King, CEO, Cestrian Capital Research, Inc.

Iridium, faced with competitive threats from SpaceX / Starlink for real and AST Mobile if it ever becomes real, is doing exactly what any management team should do in that position, which is to extend the life of the company as far as they can down the road. Then to grow cashflow faster than revenue. And to use that rising pile of cash to lever up the balance sheet to either (1) pay out ginormo levered dividends or (2) conduct a sustained buyback campaign. This is helping the stock price in the short term; personally it’s not a stock I plan to own (though the name has been good to me in the past) because in the end I think this is a “burning platform”. And in tech you don’t really ever want to own a burning platform with a public ticker. (You can make very good money if you own the whole thing, leverage it sky-high and live off the cashflows; but that’s not what’s on offer with public tickers).

Here’s the headlines.

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