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Maxar Technologies Q3 Earnings: Buying Soaring NYSE:MAXR Stock Before Call?

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Maxar Technologies Inc. (NYSE:MAXR) is scheduled to report Q3 earnings results after markets close for trading on November 5, 2020.

The company is expected to report earnings of -$0.08/share on revenue of $454.2 million. The consensus earnings per share (EPS) of -$0.08/share is based on a poll of 6 analysts and represents a growth in eps of 75.7% over the same quarter last year, when the company reported earnings of -$0.34/share.

The revenue forecast of $454.2 million based on a poll of 8 analysts implies a year-over-year (YoY) decline in revenue of −5.2%. Last year the company reported $479 million in revenue for the quarter.

Expected to report EPS of -$0.08/share for Q3, 2020
Metric Expected Prior Year YoY Change
Revenue $454.19 $479.00 −5.2%
EPS -$0.08 -$0.34 75.7%

Earnings Call Trends

Historically, management has exceeded analyst expectations 1 out of the last 8 tracked quarters, and missed expectations 7 quarters.

What are your expectations from Maxar Technologies Inc. for earnings this quarter? Let us know in the comments!

Analyst Expected vs. Reported EPS
Quarter Expected Reported Surprise Result
Q2, 2020 $0.32 $0.05 −84.7% Missed
Q1, 2020 -$0.42 -$0.52 -21.8% Missed
Q4, 2019 $0.51 -$1.02 −301.3% Missed
Q3, 2019 $0.59 -$0.34 −157.2% Missed
Q2, 2019 -$0.37 -$0.31 14.6% Beat
Q1, 2019 $0.14 -$0.49 −460.5% Missed
Q4, 2018 $0.63 $0.27 −57.5% Missed
Q3, 2018 $1.05 $0.75 −28.6% Missed

In the following table, we summarize the company’s stock price movements after earnings releases. The “Price Day Prior” column shows the closing stock price on the day before the earnings report, and the “Price Next Day” column shows the stock price at the end of the trading day after the earnings report. After the last earnings report for the period ending June 30, 2020, the stock price reacted by increasing 26.1%.

Stock Price Performance After Earnings
Report Date Price Day Prior Price Next Day Change % Result
August 5, 2020 $19.84 $25.02 26.1% Increase
May 11, 2020 $11.29 $10.03 −11.2% Decline
March 2, 2020 $15.21 $15.41 1.3% Increase
November 4, 2019 $8.95 $11.09 23.9% Increase

The other question to consider is one of earnings manipulation. There is a lot of pressure on management each quarter to deliver on earnings expectations. The Beneish M-Score is a statistical model that provides some insight into whether the company might be manipulating earnings. With a Beneish M-Score of −3.22, the model suggests that the company is not likely to be an earnings manipulator. A value of −3.22 implies a 0.1% chance of earnings manipulation.

Fundamentals And Technical Analysis

Maxar Technologies Inc. is currently trading at $25.77/share, down −3.2% for the day. The company is trading at approximately 79.5% of its 52-week high of $32.42/share. The company’s stock price is up 3.0% since the last earnings report and down −13.9% over the previous week. The company’s 14 Day Relative Price Index (RSI) of 37.14 suggests the company is trading in technically neutral territory. The RSI is considered overbought when above 70 and oversold when below 30.


NYSE:MAXR Stock Price Chart
Source: Finbox

The current share price implies a price-to-earnings (P/E) multiple of −23.77 and a forward P/E multiple of −15.29.

Maxar Technologies Inc.’s current share price also implies a price-to-book (P/B) multiple of 1.74. The following table summarizes some other key fundamental ratios:

Data as of November 1, 2020
Metric Value
Last Reported Fiscal Period Key FY2020.Q2
Period End Date June 30, 2020
Stock Price (Current) $25.77
P/E Ratio −23.8x
P/E Ratio (Fwd) −15.3x
PEG Ratio −0.2
Total Debt / Total Capital 62.3%
Levered Free Cash Flow $31 million
EV / EBITDA 11.5x

Finbox

Maxar Technologies Inc. is a small-cap stock with a market capitalization of $1.569 billion and a total enterprise value of $4.074 billion. The company operates in the Industrials sector and the Aerospace & Defense industry.

Maxar Technologies Inc. provides earth intelligence and space infrastructure solutions in the United States, Asia, South America, Europe, the Middle East, Australia, Canada, and internationally. It operates through Earth Intelligence and Space Infrastructure segments. The Earth Intelligence segment offers Earth imagery and radar data solutions, including orthorectified imagery, mosaic, elevation, and information products; and SecureWatch, a subscription offering that provides online access to imagery and geospatial intelligence platform, as well as geospatial information, applications, and analytic services. This segment serves to the U.S., Canadian, and other international government agencies, such as defense and intelligence, and civil agencies, as well as commercial customers in various markets. The Space Infrastructure segment provides space and ground based infrastructure, robotics, components, and information solutions, including communication and imaging satellites and payloads; space platforms for power, propulsion, and communication; satellite ground systems and support services; space-based and airborne remote sensory solutions; space robotics; and defense systems. This segment serves government agencies and commercial satellite operators. Maxar Technologies Inc. was founded in 1969 and is headquartered in Westminster, Colorado.

Expertise: financial modeling, mergers & acquisitions. Andy is also a founder at finbox.io, where he’s focused on building tools that make it faster and easier for investors to do investment research. Andy’s background is in investment banking where he led the analysis on over 50 board advisory engagements involving mergers and acquisitions, fairness opinions and solvency opinions. Some of his board advisory highlights: - Sears Holdings Corp.’s $620 mm spin-off via rights offering of Sears Outlet, Hometown Stores and Sears Hardware Stores. - Cerberus Capital Management’s $3.3 bn acquisition of SUPERVALU Inc.’s New Albertsons, Inc. assets. Andy can be reached at andy@finbox.io or at +1 (516) 778-6257.

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