Telesat (TSX:TSAT) - Share price, News & Analysis

TSAT fundamental analysis
Snowflake Score
Valuation	2/6
Future Growth	0/6
Past Performance	1/6
Financial Health	2/6
Dividends	0/6

TSAT Stock Overview

Telesat Corporation, a satellite operator, provides mission-critical communications services to broadcast, enterprise, and consulting customers worldwide.

Rewards

Trading at 18.7% below our estimate of its fair value

Risk Analysis

Earnings have declined by 8.3% per year over past 5 years

Interest payments are not well covered by earnings

Profit margins (10.1%) are lower than last year (70.4%)

Telesat Competitors

AT&T

NYSE:T

US$146.0b

Price History & Performance

Summary of all time highs, changes and price drops for Telesat
Historical stock prices
Current Share Price	CA$18.50
52 Week High	CA$55.00
52 Week Low	CA$14.34
Beta	0
1 Month Change	17.91%
3 Month Change	-31.79%
1 Year Change	n/a
3 Year Change	n/a
5 Year Change	n/a
Change since IPO	-62.82%

Recent News & Updates

May 19

Estimating The Intrinsic Value Of Telesat Corporation (TSE:TSAT)

In this article we are going to estimate the intrinsic value of Telesat Corporation ( TSE:TSAT ) by projecting its...

Shareholder Returns

	TSAT	CA Telecom	CA Market
7D	5.7%	-1.0%	0.8%
1Y	n/a	14.3%	4.9%

Return vs Industry: Insufficient data to determine how TSAT performed against the Canadian Telecom industry.

Return vs Market: Insufficient data to determine how TSAT performed against the Canadian Market.

Price Volatility

Is TSAT's price volatile compared to industry and market?
TSAT volatility
TSAT Average Weekly Movement	9.0%
Telecom Industry Average Movement	7.4%
Market Average Movement	9.9%
10% most volatile stocks in CA Market	16.9%
10% least volatile stocks in CA Market	4.3%

Stable Share Price: TSAT is not significantly more volatile than the rest of Canadian stocks over the past 3 months, typically moving +/- 9% a week.

Volatility Over Time: TSAT's weekly volatility (9%) has been stable over the past year.

About the Company

Founded	Employees	CEO	Website
1969	471	Dan Goldberg	https://www.telesat.com

Telesat Corporation, a satellite operator, provides mission-critical communications services to broadcast, enterprise, and consulting customers worldwide. The company’s satellite-based services allow direct-to-home (DTH) service providers to deliver television programming, audio, and information channels directly to customers’ homes; and enables broadcasters, cable networks, and DTH service providers to transmit television programming services. It offers value-added services, such as satellite capacity, digital encoding of video channels, authorization, and uplinking and downlinking services; and occasional use services for the broadcast of video news, sports, and live event coverages.

Telesat Fundamentals Summary

How do Telesat's earnings and revenue compare to its market cap?
TSAT fundamental statistics
Market Cap	CA$916.86m
Earnings (TTM)	CA$76.20m
Revenue (TTM)	CA$753.49m

12.0x

P/E Ratio

1.2x

P/S Ratio

Is TSAT overvalued?

See Fair Value and valuation analysis

Earnings & Revenue

Key profitability statistics from the latest earnings report
TSAT income statement (TTM)
Revenue	CA$753.49m
Cost of Revenue	CA$255.66m
Gross Profit	CA$497.83m
Other Expenses	CA$421.63m
Earnings	CA$76.20m

Last Reported Earnings

Mar 31, 2022

Next Earnings Date

n/a

Earnings per share (EPS)	6.33
Gross Margin	66.07%
Net Profit Margin	10.11%
Debt/Equity Ratio	210.8%

How did TSAT perform over the long term?

See historical performance and comparison

Valuation

Is Telesat undervalued compared to its fair value and its price relative to the market?

Valuation Score

2/6

Valuation Score 2/6

Below Fair Value
Significantly Below Fair Value
PE vs Industry
PE vs Market
PEG Ratio
PB vs Industry

18.7%

Undervalued compared to fair value

Share Price vs. Fair Value

Below Fair Value: TSAT (CA$18.5) is trading below our estimate of fair value (CA$22.77)

Significantly Below Fair Value: TSAT is trading below fair value, but not by a significant amount.

Price To Earnings Ratio

PE vs Industry: TSAT's PE Ratio (12x) is in line with the North American Telecom industry average.

PE vs Market: TSAT is poor value based on its PE Ratio (12x) compared to the Canadian market (11.5x).

Price to Earnings Growth Ratio

PEG Ratio: Insufficient data to calculate TSAT's PEG Ratio to determine if it is good value.

Price to Book Ratio

PB vs Industry: TSAT is good value based on its PB Ratio (2.1x) compared to the CA Telecom industry average (3x).

Future Growth

How is Telesat forecast to perform in the next 1 to 3 years based on estimates from 0 analysts?

Future Growth Score

0/6

Future Growth Score 0/6

Earnings vs Savings Rate
Earnings vs Market
High Growth Earnings
Revenue vs Market
High Growth Revenue
Future ROE

5.0%

Forecasted Telecom industry annual growth in earnings

In this section we usually present revenue and earnings growth projections based on the consensus estimates of professional analysts to help investors understand the company’s ability to generate profit. But as Telesat has not provided enough past data and has no analyst forecast, its future earnings cannot be reliably calculated by extrapolating past data or using analyst predictions.

This is quite a rare situation as 97% of companies covered by SimplyWall St do have past financial data.

Past Performance

How has Telesat performed over the past 5 years?

Past Performance Score

1/6

Past Performance Score 1/6

Quality Earnings
Growing Profit Margin
Earnings Trend
Accelerating Growth
Earnings vs Industry
High ROE

-8.3%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: TSAT has high quality earnings.

Growing Profit Margin: TSAT's current net profit margins (10.1%) are lower than last year (70.4%).

Past Earnings Growth Analysis

Earnings Trend: TSAT's earnings have declined by 8.3% per year over the past 5 years.

Accelerating Growth: TSAT's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: TSAT had negative earnings growth (-86.5%) over the past year, making it difficult to compare to the Telecom industry average (-9.5%).

Return on Equity

High ROE: TSAT's Return on Equity (10%) is considered low.

Financial Health

How is Telesat's financial position?

Financial Health Score

2/6

Financial Health Score 2/6

Short Term Liabilities
Long Term Liabilities
Debt Level
Reducing Debt
Debt Coverage
Interest Coverage

Financial Position Analysis

Short Term Liabilities: TSAT's short term assets (CA$1.6B) exceed its short term liabilities (CA$179.2M).

Long Term Liabilities: TSAT's short term assets (CA$1.6B) do not cover its long term liabilities (CA$4.4B).

Debt to Equity History and Analysis

Debt Level: TSAT's net debt to equity ratio (125%) is considered high.

Reducing Debt: TSAT's debt to equity ratio has reduced from 490.6% to 210.8% over the past 5 years.

Debt Coverage: TSAT's debt is not well covered by operating cash flow (6.5%).

Interest Coverage: TSAT's interest payments on its debt are not well covered by EBIT (2x coverage).

Balance Sheet

Dividend

What is Telesat current dividend yield, its reliability and sustainability?

Dividend Score

0/6

Dividend Score 0/6

Notable Dividend
High Dividend
Stable Dividend
Growing Dividend
Earnings Coverage
Future Dividend Coverage

Dividend Yield vs Market

Notable Dividend: Unable to evaluate TSAT's dividend yield against the bottom 25% of dividend payers, as the company has not reported any recent payouts.

High Dividend: Unable to evaluate TSAT's dividend yield against the top 25% of dividend payers, as the company has not reported any recent payouts.

Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if TSAT's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if TSAT's dividend payments have been increasing.

Earnings Payout to Shareholders

Earnings Coverage: Insufficient data to calculate payout ratio to determine if its dividend payments are covered by earnings.

Cash Payout to Shareholders

Cash Flow Coverage: Unable to calculate sustainability of dividends as TSAT has not reported any payouts.

Discover strong dividend paying companies

Management

How experienced are the management team and are they aligned to shareholders interests?

9.3yrs

Average management tenure

CEO

Dan Goldberg (55 yo)

15.67yrs

Tenure

CA$64,096,218

Compensation

Mr. Daniel S. Goldberg, also known as Dan, serves as Independent Director for Algonquin Power & Utilities Corp. since March 28, 2022. He serves as President and Chief Executive Officer at Loral Space & Com...

CEO Compensation Analysis

Compensation vs Market: Dan's total compensation ($USD49.93M) is above average for companies of similar size in the Canadian market ($USD1.54M).

Compensation vs Earnings: Dan's compensation has increased by more than 20% whilst company earnings have fallen more than 20% in the past year.

Leadership Team

Experienced Management: TSAT's management team is seasoned and experienced (9.3 years average tenure).

Board Members

Experienced Board: TSAT's board of directors are not considered experienced ( 0.5 years average tenure), which suggests a new board.

Ownership

Who are the major shareholders and have insiders been buying or selling?

Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.

Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: TSAT only recently listed within the past 12 months.

Data	Last Updated (UTC time)
Company Analysis	2022/05/21 00:00
End of Day Share Price	2022/05/20 00:00
Earnings	2022/03/31
Annual Earnings	2021/12/31