1 Galactic Stock Up 50%, Will It Keep Going?
A few months ago, we wrote an article titled Is This Stock Set To Blast Off in which we featured Planet Labs, trading at under $2 per share at the time.
Since then, the stock is up by over 50% on a slew of positive news including a new 7-figure deal with NATO.
But will the good news continue to flow and how high can Planet Labs stock go now?
Key Points
- Planet Labs’ stock jumped over 50%, driven by positive news including a significant deal with NATO and satellite launch advancements.
- The company is leveraging its satellite data more effectively, leading to shorter sales cycles and increased revenue potential.
- With consistent growth and expanding capabilities, analysts predict up to a 40% further increase.
What’s Up With Planet Labs?
When Warren Buffett was asked how he could generate 50% annualized returns now, his answer was that, if he were starting out, he would look at smaller-sized companies.
His Berkshire Hathaway is too large to meddle among small-cap enterprises but for the ordinary investor a wealth of opportunity exists there.
Planet Labs fits squarely into that opportunity set with a market cap just shy of a billion yet generating hundreds of millions in revenues. The challenge for a long time was Planet Labs was held back as a company that sat on massive data troves – satellite imagery – but no easy ways for clients to access and interpret it, leading to long sales cycles.
That all seems to be changing and recent contracts, such as the $1 million deal with NATO announced last week are evidence of the value the company provides to strategic partners.
Another notable catalysts was the company’s announcement that its Tanager-1 satellite, along with 36 SuperDove satellites, would be launched on SpaceX’s Transporter-11 Rideshare mission.
This is an important launch because the Tanager-1 satellite will enhance Planet Labs’ capabilities by capturing hyperspectral data, which is crucial for applications in defense, intelligence, biodiversity assessments, mineral mapping, and water quality monitoring.
So, what does it all mean for the share price?
How High Will Planet Labs Stock Go?
Planet Labs has in many ways been a treacherous stock to hold because of its heightened volatility. But recently it broke out of a long-established base, and the technical signs are increasingly positive.
Key numbers seem to justify the move higher, too. Planet Labs also showed strong financial performance in its recent earnings reports, which further fueled investor optimism.
Management has reported consistent revenue growth and has improved operating margins, indicating a solid path toward profitability. Strengthening financials have emboldened investor confidence in the company’s ability to continue scaling its business model.
Looking to the future, Planet Labs’ future prospects appear promising, especially as the demand for satellite data continues to grow across various industries. The company’s expansion into hyperspectral imaging has the very real potential to open up new revenue streams and ultimately improve the bottom line.
Analysts are generally optimistic and have a share price target of $4.21 per share on the stock. That’s the consensus among 10 research analysts. If they are correct, another 40% run higher is possible before Planet Labs reaches fair value.
