Echostar

one of my holding beside DLCs

SAT!

$SATS(S58.SG)

SATS has climbed to S$4.73 and is holding at a new 52-week high.

Its latest growth plan involves AI and “F1-style telemetry” across its global aviation and cargo network. But the real opportunity is not the buzzword—it is operating leverage.

SATS runs a large, complex network where small improvements in staffing, cargo flow and aircraft turnaround times can add up quickly. If the platform reduces delays and improves asset utilisation, revenue does not need to rise dramatically for margins to expand.

That matters because SATS is moving from recovery into optimisation. Aviation demand and cargo volumes have improved, earnings are recovering, and analysts have raised their targets. The next stage is proving that its expanded global footprint can generate better returns, not merely more revenue.

The risk is that the stock has already reached a fresh high, so investors are beginning to price in successful execution.

My view: the AI strategy could become a genuine margin catalyst, but the next earnings report must show measurable productivity gains. Otherwise, the headline may have moved faster than the fundamentals.

In the second quarter, the Singapore stock market surged over 14%, with dividend yields of the three major banks all exceeding 4%, and bank stocks rose over 15%.

Benefiting from the Middle East ceasefire agreement, Singapore Airlines and Sats' stock prices have climbed significantly.

However, the performance of emerging markets remains unsatisfactory.

The second half of the year, especially the third quarter, is crucial. Let's wait and see.

SATS | Maybank Research | BUY | Target Price S$5.09 | 01 Jul 2026

Maybank keeps SATS at BUY, raises its DCF-based target price to S$5.09, and argues the post-results share price move is more than a short-term relief rally due to clearer visibility on long-term growth drivers.

Key calls and valuation

The analysts lower WACC from 10.6% to 10.0% as they see lower execution risk, and lift FY26–27 earnings by 2.5% and 9.7% respectively, mainly on stronger expected contribution from the Thailand central kitchen from FY27.

At the time of writing, they highlight SATS is trading at about 21x FY27E P/E with a 1.5% dividend yield, which they view as attractive versus growth prospects.

Recommendation is BUY with a raised target price of S$5.09, based on DCF.

Growth thesis and FY29 targets

Management reiterates FY29 aspirations of revenue above S$8 billion, EBITDA margin of at least 20%, and ROE of 15%.

Maybank sees these targets as increasingly credible, supported by: sustained share gains in air cargo, better utilisation across the global food solutions network, and selective M&A into new cargo hubs.

A core plank is cargo, where SATS’ volumes have outperformed IATA for 10 consecutive quarters, aided by its global network and exposure to resilient tech and e‑commerce flows; Maybank projects about 5% cargo volume growth in FY27 with yields holding.