Globalstar, Inc. (NYSEMKT: GSAT)
Globalstar is having a strong day in the market today, and for good reason. For some time now, the company has been seeking FCC approval with regard to the use of special airwaves. Recently, the overall sentiment seemed as though the FCC would deny the company’s request. However, today, things seem to be changing. In fact, the belief that the FCC will approve the proposal is growing. Today, we’ll talk about the news, how GSAT reacted in the market, and what we can expect to see from the stock moving forward.
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GSAT Could Get Approval From The FCC
As mentioned above, Globalstar has been working to gain approval from the FCC with regard to a specific type of airwave. The airwaves, known as the TLPS spectrum, have the potential to improve WiFi connectivity, which would be overwhelmingly profitable for GSAT.
Recently, the news has been portraying a negative view. With the initial FCC member votes against the proposal, the company needs the rest of the votes to be positive. Nonetheless, an analyst by the name of Niles Tracy at Heights Securities believes that an approval is likely. In fact, the analyst believes that a positive result could come as soon as next week. In a statement, the analyst had the following to offer:
“The initial ‘no’ vote from Commissioner Pai came on June 2,2016. A reported Rosenworcel ‘dissent’ followed. At the same time, Commissioner Rosenworcel and Commissioner O’Rielly met with the NCTA, and then the other pro-GSAT groups over the following weeks. Commissioner Rosenworcel never confirmed whether she had dissented, or whether she had actually voted, which indicates to us that the ‘no’ speculation was either a negotiating tactic, or perhaps was unintentional implication from her staff. We continue to believe that this ‘dissent’ was actually a bargaining tactic, and the Rosenworcel may ultimately approve the order.
The ongoing ex-parte meetings indicate that both Rosenworcel and O’Rielly are continuing to consider and debate the order. 18 days have past since the original announcement from Commissioner Pai. As the timeline continues to extend, the likelihood that the order is being negotiated increases, and the likelihood of the order being voted down decreases.”
How The Market Reacted To The News
As investors, we know that the news moves the market. Anytime there is positive news released with regard to a publicly-traded company, we can expect to see gains surrounding the stock associated with the company. In this particular case, the news was overwhelmingly positive. After all, GSAT needs a positive vote here, and it seems as though they may get it. As a result, we’re seeing gains in the value of the stock today. Currently (11:18), Globalstar stock is trading at $1.39 per share after a gain of $0.19 per share, or 15.83%, thus far today.
What We Can Expect To See Moving Forward
Moving forward, I have a relatively mixed opinion of what we can expect to see from GSAT. At the moment, everything seems to be riding on the FCC’s decision to approve or deny the company’s proposal. However, I will say that things are starting to look overwhelmingly positive. There’s no denying the fact that the delays in votes are likely the result of negotiations, which could lead to positive results. All in all, things do look positive. However, if you do move, please move with caution.
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What Do You Think?
Where do you think GSAT is headed moving forward and why? Let us know your opinion in the comments below!
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