There are times when traders and investors looking for short-term gains forget the power of the long-term Foolish investing approach. While temporary dips in a fundamentally strong stock may feel uncomfortable, they also create chances to grab quality stocks at a big bargain. And when a company’s long-term outlook is strong, contracts are flowing in and it’s gaining industry recognition, a pullback in its share price could be a rare gift.
One such stock, MDA Space (TSX:MDA), operating in one of the most exciting and high-growth sectors, has seen a sharp downside correction lately. In this article, I’ll walk you through MDA’s financials and growth prospects and tell you why this top Canadian stock looks like a steal to me at current levels.
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A quality Canadian stock, temporarily beaten down
After a sharp run-up earlier in 2025, MDA’s shares have pulled back hard in recent months. The stock is currently trading at $25.55 per share, down over 40% in the past three months, and sitting 47% below its 52-week high. Despite the recent drop, the company still commands a market cap of about $3.2 billion.
So what caused the steep slide? Mainly, this top Canadian stock took a hit following EchoStar’s abrupt cancellation of a major $1.8 billion satellite contract in early September. While this development triggered a sell-off in its stock, it hardly had anything to do with MDA’s long-term growth prospects. EchoStar simply changed its business plans and sold its spectrum to SpaceX. Nevertheless, MDA will still be compensated for the cancelled contract.
Strong execution and financials
While the news headlines may raise concerns, MDA’s underlying performance has stayed solid. In the second quarter of 2025, the company delivered a solid 54% YoY (year-over-year) revenue jump to $373.3 million, backed mainly by higher volumes in its satellite systems business. Notably, this business segment saw its revenue more than double last quarter due mainly to the ramp-up of the Telesat Lightspeed and Globalstar LEO (Low Earth Orbit) constellation programs.
This solid top-line growth drove its adjusted EBITDA (earnings before interest, taxes, depreciation, and amortization) for the quarter up by 57% YoY to $76.3 million. Similarly, its EBITDA margin held strong at 20.4%. These revenue and profitability numbers clearly show that the company was executing well, even without factoring in the now-terminated EchoStar deal.
Notably, MDA ended the quarter with $416.8 million in net cash, giving it more than enough flexibility to invest in future growth and handle short-term volatility with ease.
A solid backlog and a promising growth pipeline
MDA entered the second half of the year with a strong backlog of $4.6 billion, giving it strong revenue visibility well into the coming years. And we shouldn’t forget this figure excludes the cancelled EchoStar contract. In fact, the company recently reiterated its full-year 2025 revenue guidance of $1.57 billion to $1.63 billion, suggesting roughly 50% growth on average. At the same time, it is still projecting adjusted EBITDA of $305 to $320 million for the year.
Beyond the numbers, MDA is continuing to win recognition across the globe. In September, it was named the 2025 Global Satellite Business of the Year at World Space Business Week.
While the recent decline in share price may look ugly, MDA’s fundamentals make this correction look like a rare window to grab a top Canadian stock to buy now before sentiment turns bullish again.
