Prime Highlights
- Amazon’s potential Globalstar deal would directly boost Project Kuiper, its satellite broadband programme competing in the global space internet market.
- Apple’s 20% stake in Globalstar could complicate deal terms and affect Amazon’s long-term partnership plans.
Key Facts
- Globalstar is a low Earth orbit satellite telecom company, with Apple as one of its major shareholders.
- Amazon shares trade nearly 40% below estimated fair value, with analysts targeting a price of $281.27 against the current $209.77.
Background
Amazon is in advanced talks to buy satellite telecom company Globalstar. The deal would help the tech giant build its own satellite network and strengthen its existing Project Kuiper satellite internet programme.
If the deal goes through, it could change how Amazon uses satellite connectivity across its cloud, e-commerce and logistics businesses. Project Kuiper is Amazon’s satellite broadband project, built to compete in the fast-growing space internet market.
One complication is Apple’s roughly 20% stake in Globalstar. This could make negotiations complex and may affect the final deal terms and any future partnership between Amazon and Apple.
Amazon shares currently trade on the stock market at approximately $209.77. The analysts consider the stock to be undervalued because they set a target price of $281.27, which exceeds current stock prices by approximately 25%. The estimates show that the shares trade at approximately 40% below their actual worth, which indicates potential future growth.
Short-term performance, however, remains weak. The stock has fallen around 4% over the past month and about 7% so far this year, despite gaining nearly 23% over the past year.
Analysts say the price Amazon pays for Globalstar and any new spending linked to Project Kuiper will be closely watched as the deal develops.
If completed, the acquisition would mark a major step in Amazon’s push to own and operate a full satellite connectivity network.
