It’s always exciting when a stock starts jumping, even more so when it doubles. While there are quite a few that have doubled since the beginning of year, it’s a lot harder to find ones that have doubled in a shorter time period than that — never mind a month.
But there is indeed a stock that has both doubled in the last month and is worth looking at today: Maxar Technologies Inc. (TSX:MAXR)(NYSE:MAXR). So let’s take a look at what made this stock double and whether it still deserves investor attention.
This award-winning global technology innovator has quite a few things going for it. The company is helping to power the “new space economy,” providing 2D and 3D images for autonomous vehicles, and even studying systems to “revolutionize NASA’s space-based communications architecture.”
On May 23, the stopped jumped yet again after announcing that it would be the contractor for the Lunar Gateway Mission that plans to send astronauts to the moon by 2024. The contract will bring in $375 million, sending the stock up 25% in a day. That’s in addition to its share price jump since early April that has seen the stock double.
Now, the stock hasn’t had the rosiest outlook in the past year. In fact, the company is miles away from its all-time highs near $100 per share. Since 2015, when those numbers were hit, the company has slowly and steadily slipped, with the biggest fall coming in the last year. Jan. 1, 2018 the stock traded at $77.62, and within one year to date had plummeted 190% to $7.68.
A huge part of the recent loss was the loss of the company’s contract with WorldView-4 satellite. While the company had the loss insured for $183 million, Wall Street wasn’t convinced and basically gave up on the stock. The loss contributed quite a bit to quarterly losses, but even so, the company had to tell investors that revenue had declined 9% year over year to $496 million.
To be honest, with this recent news, this stock will likely keep going up. While it may not reach the highs it saw a couple years ago near $100 per share, but it’s definitely working toward much higher than its share price at the time of writing around $12 per share. In fact, a few analysts are predicting it to rise to $73 per share in the next 12 months, an upside of 513% from the time of writing.
I’m not going to lie: buying this stock is still risky. While the company may have recent news going for it, it’ll have to keep that up to make up for the news from the next quarterly earnings reports. The contracts are nice, but it’ll likely be spending a lot too, and that could still mean the company is continuing to produce losses rather than revenue.
But again, I could be wrong. The stock was big once and could be again by making these large partnerships, and once underway with a big name like NASA, the company could easily get the push it needs to get its stock back to where it was only a year ago, if not better.
When you buy heavily cyclical stocks at low prices… and then hold the shares until the cycle reaches its peak… you can make a very healthy profit.
Every investor knows that. But many struggle to identify the best opportunities.
Except The Motley Fool may have a plan to solve that problem! Our in-house analyst team has poured thousands of hours into their proprietary research – and this is the result.
Our top advisor Iain Butler has just identified his #1 stock to buy in 2019 (and beyond).
Fool contributor Amy Legate-Wolfe has no position in any of the stocks mentioned. Maxar Technologies is a recommendation of Stock Advisor Canada.