Investment bank Morgan Stanley, reportedly a front-runner bank to handle an Initial Public Offering (IPO) for SpaceX’s Starlink – has downgraded satellite operator Iridium and has cut its former price steeply from $37 to $24 and a new share price target for Iridium.

The bank advised clients that its outlook for Iridium shifts from ‘Overweight’ to ‘Equal weight’.

As of January 14th, the average (from a number of banks) one-year price target for Iridium Communications is $29.35 per share. The forecasts range from a low of $16.16 to a high of $42. The average price target represents an increase of 52.33 per cent from its latest reported closing price of $19.27 per share.

Morgan Stanley in its report says that Iridium removed its long-term sales guidance after its third-quarter 2025 results and outlined a new strategy prioritising mergers and acquisitions in adjacent markets while accelerating investments in emerging growth areas.

The research firm expressed concern about Iridium’s limited Merger & Acquisition track record and cited “incremental execution risk” in the company’s new strategy, suggesting uncertainty would limit near-term upside potential for the stock.

Despite these concerns, Morgan Stanley acknowledged that with Iridium shares down approximately 37 per cent over the past 12 months and trading at a nearly 15 per cent free cash flow yield for the next twelve months, the risk-reward balance appears even at current levels.

In its most recent financial numbers, Iridium reported third-quarter 2025 earnings that exceeded analyst expectations, with an earnings per share of $0.35 compared to the forecasted $0.26. This represents a 34.62 per cent earnings surprise, underscoring the company’s strong financial performance. Additionally, Iridium secured a significant contract from the US Space Force, valued at up to $85.8 million, to support technological and security enhancements.

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Tags: bank, iridium, Morgan Stanley