What Happened?
Shares of satellite communications provider Globalstar (NASDAQ: GSAT) jumped 3.1% in the afternoon session after the company and Parsons Corporation announced a successful proof of concept for a joint commercial satellite solution. This collaboration integrated Globalstar's Low Earth Orbit (LEO) satellite capabilities with advanced software from Parsons, a leader in national security solutions. The company stated this successful test marked a significant step toward the commercial availability of their joint product. This development paved the way for new commercial satellite solutions, signaling progress in the company's technological and business partnerships.
After the initial pop the shares cooled down to $24.82, up 2.3% from previous close.
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What Is The Market Telling Us
Globalstar’s shares are extremely volatile and have had 41 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The previous big move we wrote about was 4 days ago when the stock dropped 4.8% after a surprisingly weak U.S. jobs report was released, fueling concerns about a slowing economy. The U.S. economy added only 73,000 jobs, falling significantly short of economists' expectations, while figures for May and June were revised down, erasing 258,000 previously reported jobs. The professional and business services industry itself shed 14,000 jobs. This data points to a cooling labor market, fueling concerns of a slowing economy. A weaker economic outlook often leads to reduced corporate spending on key services like IT consulting and professional staffing, which directly impacts the sector's revenue and growth prospects. The report immediately increased investor expectations of an interest rate cut by the Federal Reserve.
Globalstar is down 22% since the beginning of the year, and at $24.82 per share, it is trading 27.7% below its 52-week high of $34.35 from December 2024. Investors who bought $1,000 worth of Globalstar’s shares 5 years ago would now be looking at an investment worth $4,319.
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