ViaSat Stock Surges 24% on Analyst Upgrade and Potential Defense Unit IPO

ViaSat (VSAT) shares jumped 24% intraday Monday after William Blair analyst Louie DiPalma upgraded the satellite communications firm to "outperform." The bullish call hinges on two catalysts: a potential spin-off of ViaSat's defense technology division and projected free cash FLOW positivity by late 2024.

DiPalma's sum-of-the-parts analysis suggests the stock could double within twelve months. The defense unit—responsible for 27% of revenue and all corporate profits—may pursue an IPO, while $568 million in expected 2026 payments and reduced capital expenditures after final satellite launches could improve cash Flow dynamics.

Market skepticism persists about the ambitious valuation targets. Satellite deployment remains capital-intensive, and the post-IPO entity's commercial broadband operations face unproven profitability. The defense spin-off's timing and valuation will prove critical for shareholder returns.