Thursday, April 25, 2024
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Why Satellite Chipmaker SATX Stock Is Worth Betting On

There are plenty of microchip producers you can invest in. However, Satixfy Communications (NYSE:SATX) is quite different from the rest of them. SATX stock earns a “B” rating because there’s definitely risk involved, but Satixfy appears to be pioneering a specific market with growth potential.

Satixfy Communications is an Israel-based satellite communications component maker. The company went public on Oct. 28, through a special purpose acquisition company (or SPAC) merger with Endurance Acquisition Corp., which is now a subsidiary of Satixfy.

This isn’t just another SPAC investment, though. You’re encouraged to learn about this truly unique company that’s addressing a global connectivity problem. Ultimately, you might even be convinced to try out an appropriately sized, all-or-nothing wager on Satixfy Communications.

SATX Satixfy Communications $10.14

Don’t Get Hung Up on the Price Trajectory of SATX Stock

Sorry to be the bearer of bad news, but SATX stock is yet another example of a post-SPAC pop-and-drop. As we explained recently, Satixfy shares dropped around 62% from their peak, though they’re still up over the past two months.

There’s still an opportunity here, and if you buy the shares now, at least you didn’t get caught chasing the hype rally. In any case, if you’re in it for the long term with Satixfy Communications, then the short-term price moves are less important than the long-term growth proposition.

You see, Satixfy Communications is no ordinary chipmaker. It’s a fabless semiconductor company that offers technology products based on its own chipsets. These components are intended to serve the full satellite communications product chain, and include modem and digital beam-forming antenna products.

Satixfy sells these products to various satellite-market companies. It’s a self-contained, vertically integrated business that designs its own chips and even codes its own software. So, what’s the growth potential of this fascinating company?

Satixfy Has Demonstrated Its Technology

Actually, the growth potential is considerable. Reportedly, Satixfy Communications is serving a total addressable market (TAM) for satellite-market chipsets and related products that are valued at an estimated $20 billion or more by the end of the 2020s. Moreover, Satixfy estimates that its revenues will expand to a whopping $300 million by 2026.

Plus, Satixfy is addressing the global demand for always-available connectivity “anywhere, anytime, any altitude and any latitude.” You never know where you might find Satixfy’s tech components: in rural areas, on airplanes or even on ships at sea.

Additionally, Satixfy Communications has already provided a demonstration of its products in real life. As the company reported, on June 28 of this year, SatixFy “played a key role in demonstrating a high-speed, low-latency link with a LEO satellite constellation incorporating 5G” in the UK.

With that, the company helped to achieve the “world’s first ever 5G backhaul communications connected to a LEO satellite constellation.” This could prove to be a historic moment in the development of direct-to-cell 5G connectivity technology.

What You Can Do Now

Be aware that there are risks involved here, as Satixfy Communications is involved in a still-emerging niche tech field. It could take years for Satixfy’s business to really get off the ground. So, consider your time horizon before investing in this company.

Still, SATX stock deserves a “B” rating because Satixfy certainly has growth potential. Just be sure to understand the risks involved if you choose to invest in Satixfy Communications. Furthermore, keep your position size small, since this could turn out to be an all-or-nothing wager.

On the date of publication, neither Louis Navellier nor the InvestorPlace Research Staff member primarily responsible for this article held (either directly or indirectly) any positions in the securities mentioned in this article.

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