Globalstar (NYSE:GSAT), Inc. (NYSEAMERICAN:GSAT) CEO Paul E. Jacobs has sold a substantial number of shares in a transaction dated June 28, 2024. The chief executive offloaded 4,510,855 shares at an average price of $1.0641, totaling around $4.8 million. This move comes alongside the acquisition of shares through different agreements, reflecting active management of Jacobs' stake in the satellite communications company.
The sold shares were part of a private placement to an affiliate of the Thermo Companies, which are under the control of James Monroe III, Globalstar's Executive Chairman. The transaction was based on the volume-weighted average price (VWAP) of the stock for the ten trading days preceding the sale date, which is consistent with the terms provided in the Support Services Agreement.
In addition to the sale, Jacobs acquired 7,654,036 shares of Globalstar's voting common stock, valued at approximately $8.1 million, under the same VWAP of $1.0641. This acquisition includes shares obtained as fees under the Support Services Agreement and as Holdback Shares under the Intellectual Property License Agreement. These shares are held indirectly by Jacobs through Virewirx, Inc., formerly known as XCOM Labs, Inc., a corporation he controls.
Following these transactions, Jacobs' indirect holdings through Virewirx, Inc. stand at 3,143,182 shares. Additionally, Jacobs has a direct ownership of 76,523 shares and an indirect ownership of 16,745,989 shares held by a trust.
Investors and market watchers often look to insider buying and selling activities as potential indicators of a company's future prospects. The recent transactions by Globalstar's CEO will likely be of interest to those closely monitoring the company's stock performance and insider confidence levels.
In other recent news, Globalstar, Inc. has unveiled its Q1 financial results, spotlighting a substantial government contract and the inaugural shipment of its commercial units of XCOM RAN to a prominent global retailer. The company reported a total revenue of $56.5 million, a 7% increase in service revenue from the previous year, and a robust adjusted EBITDA margin of 52%. A five-year contract with a government services company was initiated, with revenue commitments set to rise to $20 million by the fifth year.
Despite a decline in subscriber equipment revenue due to timing issues, Globalstar's IoT service revenue saw a significant 24% growth. The company also reiterated its full-year revenue and adjusted EBITDA outlook, indicating confidence in its future prospects. Globalstar's technical teams are actively working to incorporate Band 53 into XCOM RAN, with a full commercial launch anticipated. These are among the recent developments for the satellite communications company.
InvestingPro Insights
As Globalstar, Inc. (NYSEAMERICAN: GSAT) navigates through an active phase of insider transactions, investors are privy to a mixed landscape of financial data and market performance. According to the latest real-time metrics from InvestingPro, Globalstar has experienced a notable revenue growth of 27.11% over the last twelve months as of Q1 2024, reaching $221.64 million. This growth, however, is juxtaposed against a quarterly decline of 3.69% in revenue for Q1 2024. Furthermore, the company maintains a robust gross profit margin of 67.4%, underscoring its ability to effectively manage its cost of goods sold.
On the operational front, Globalstar's adjusted operating income stands at a loss of $8.5 million, with an operating income margin of -3.83%. Despite this, the company's EBITDA has shown an impressive growth of 39.2%, amounting to $79.86 million over the same period. These figures highlight the company's challenges in achieving operational profitability while managing to generate significant earnings before interest, taxes, depreciation, and amortization.
InvestingPro Tips reveal that analysts do not expect Globalstar to be profitable this year, which aligns with the company's current operating income figures. Additionally, Globalstar operates with a moderate level of debt and has not been profitable over the last twelve months. Moreover, while the stock has suffered a considerable decline of 42.27% over the past six months, it's worth noting that it has delivered a strong return over the last five years. Investors should also be aware that Globalstar does not pay a dividend to shareholders, which may influence investment decisions for those seeking periodic income.
For those interested in a deeper dive into Globalstar's financial health and stock performance, InvestingPro offers a comprehensive suite of additional tips. There are currently 5 more InvestingPro Tips available for Globalstar at https://www.investing.com/pro/GSAT. Readers looking to access these insights can take advantage of a special offer using the coupon code PRONEWS24 to get up to 10% off a yearly Pro and a yearly or biyearly Pro+ subscription.
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