Globalstar (NYSE) is an American satellite provider. It also has a focus on IoT (Internet of Things). GSAT stock has been volatile over the past month because of several rumors. GSAT stock rose from $1.33 to $2.78 per Share a month earlier, before falling back down to $1.77 as of Friday’s close.

Investors who stayed on have seen triple-digit gains in this stock over the past few weeks, which has translated into more than 30% gains. Investors who didn’t sell due to the rumors might still be holding onto a stock that they aren’t sure about.

Given the volatility that could be expected for the satellite communications company, GSAT stock is currently neutral. Let’s take a look at what has been happening with Globalstar lately.

(See Globalstar stock charts on TipRanks)

No Apple (NASDAQ:) Deal

The key driver of Globalstar’s impressive move this month has been a rumored deal with Apple (AAPL) to provide satellite services for Apple’s iPhone 13.

But, last week it was revealed that the iPhone 13 would not support satellite services. Rumored deals between Globalstar and Apple were dead.

Investors can expect stock prices to rise if a significant catalyst like this is discarded. GSAT stock is still trading at a level that was well above its previous month’s levels, surprising many investors. It is possible that a deal could be made for the next generation iPhone. This will likely be available in 2014.

GSAT stock is an interesting medium- to long term investment in the event of such a deal. Perhaps there are talks between the companies. According to reports, CEO Tim Cook prioritizes low-earth orbit satellite communication since 2019.

GSAT investors are excited about other initiatives that are in the works. Investors are excited that the company has reportedly been pursuing additional deals in IoT. Remote monitoring of alternative energy sectors has tremendous potential. Potential investors may forget all about the Apple selloff.

Financials Leave Much to Be Desired

One of the reasons GSAT stock sunk so rapidly on news that there was no news of a deal with Apple, is this company’s need for a financial boost.

Its growth is steady at the moment. Investors might be curious to learn more about the financial performance of the company before investing.

The company has had a slowdown in subscriber growth, which is largely responsible for its poorer than expected performance. This quarter’s net loss of $21million was slightly higher than that reported in the previous year.

Globalstar has $67 million of cash available at the moment.

This company has a strong financial position that can support multiple expansion, and should it see a boost in its top line, then this could be a good company to invest in.

Key Products Seeing Interest

One of Globalstar’s core products, the SPOT Gen4 Satellite GPS Messenger, has seen impressive interest of late. Globalstar and France’s Federation of Free Flight have recently signed a deal to purchase Globalstar’s SPOT Gen4 Satellite GPS Messenger. This will ensure that its free flight participants are safe. Yorkshire Peat Partnership is also equipped with SPOT Gen4 satellites that will protect scientists on remote moors.

GSAT shares are certain to benefit from these announcements due to the continued demand for its consumer products. Globalstar’s consumer-oriented services would certainly have grown if an Apple iPhone deal had been made. Globalstar’s investors will have to be content with the resources they currently possess.

However, Gen4 revenue fell 3.8% to $11.14million during the second quarter. This is due in large part to the decline of its average revenue by user (ARPU).

ARPU could fall further, the company anticipates. GSAT stock investors might have trouble making an argument for growth right now.

What Are Analysts Saying About GSAT Stock

Globalstar stock is considered a Hold by TipRanks analyst ratings consensus. Two analyst ratings are available: 1 Buy recommendation, 1 Sell recommendation.

The average Globalstar price target is $1.90. Globalstar price targets for analysts can range anywhere from $0.55 per share up to $3.25.

Bottom Line

Indeed, the rumored Apple deal appears to have been just that – rumors. GSAT stock would undoubtedly have seen such a deal as a catalyst for growth. However, investors now need to find another catalyst to propel this stock higher.

It’s difficult to locate such a catalyst right now. Globalstar has a solid stable of customers that will allow it to continue to generate cash flow over the long-term. But, it is possible that explosive growth will not be possible for quite some time, at least until the rumor mill gets hot again.

Disclosure: Chris MacDonald had no position at the time this article was published.

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