Voyager got here away from its IPO with a boatload of money. Now it is spending it.
Voyager Applied sciences (VOYG 12.60%), one among a handful of house corporations angling to construct the subsequent house station to switch the Worldwide Area Station, introduced at present it has acquired privately held BridgeComm Applied sciences to speed up Voyager’s “skill to ship superior optical communication options for the protection and business markets.”
Traders love the information, and Voyager inventory is rocketing this afternoon — up 11.1% by means of 12:45 p.m. ET.
Picture supply: Getty Photos.
Irrational exuberance?
However is Voyager inventory actually price 11% extra at present than it was on the shut of buying and selling final week all due to this acquisition? That is arduous to inform.
For one factor, Voyager did not disclose a purchase order worth for BridgeComm, nor give any element on the goal’s personal annual income or profitability. For one more, whereas Voyager says it is doing the acquisition “to reply to one of many fastest-growing wants in protection and business communications,” and that it’s going to now have the ability to “develop differentiated programs on a a lot shorter schedule,” there is no point out of particular contract alternatives that may confide in Voyager by means of this acquisition.
Missing a lot element, then, on how a lot Voyager is spending, or what precisely it is getting for its cash, it is arduous to say if that is good or dangerous information for Voyager inventory.
Is Voyager inventory a purchase?
What I can inform you is that Voyager inventory is just not at present worthwhile, having misplaced $82 million during the last 12 months. Voyager is cash-rich after its preliminary public providing (IPO), with $460 million extra cash than debt on its steadiness sheet. Nevertheless it’s burning by means of money reserves on the price of $145 million per yr, which means the corporate has simply three years’ price of money left — and now maybe lower than that after shopping for BridgeComm.
Let’s simply say that at this level, I am not optimistic about Voyager inventory.
Wealthy Smith has no place in any of the shares talked about. The Motley Idiot has no place in any of the shares talked about. The Motley Idiot has a disclosure coverage.
