Apple Partner Globalstar Just Set a New Record, but Did You Even Notice?

Core Viewpoint - Globalstar reported record revenue for 2024, but the stock price declined post-earnings announcement, indicating a lack of investor confidence despite strong financial results [1][2]. Financial Performance - Globalstar achieved a record revenue of $250.3 million in 2024, marking a 12% year-over-year increase, with Q4 revenue rising 18% year-over-year to $61.2 million [2]. - The company projected 2025 revenue between $260 million and $285 million, representing a potential increase of up to 13% from 2024 [2]. - Despite the revenue growth, Globalstar reported a net loss of $50.2 million for Q4 and $63.2 million for the year, primarily due to noncash losses related to debt extinguishment [3]. Cash Flow Analysis - Globalstar generated $185 million in positive free cash flow (FCF) in 2024, a significant improvement from a $100 million cash burn in 2023, marking the highest FCF in the company's history [4]. - Future FCF projections are uncertain, with analysts predicting a return to negative cash flow in 2025, followed by a modest recovery to $69 million in 2026 [8]. Market Valuation - The current market cap of Globalstar is $2.7 billion, but the volatility in FCF raises concerns about its valuation. A conservative estimate suggests a price-to-free-cash-flow ratio of 39 times based on projected future cash flows [9]. - The overall assessment indicates that while the recent quarter was strong, the sustainability of performance is questionable, leading to a recommendation against buying the stock [10].