LLAP - Terran Orbital is double downgraded at Bank of America

2023-05-26 07:35:30 ET

Bank of America lowered its rating on Terran Orbital Corporation ( NYSE: LLAP ) to Underperform on Friday after having the aerospace stock set at Buy.

Analyst Ronald Epstein and team see significant risk associated to Terran Orbital's ( LLAP ) ramp on the Rivada Space Networks contract, as well as the overall lack of revenue diversity.

"In our view, Rivada is still a largely unknown customer and we remain concerned around the durability of its growth. Additionally, while management appears confident in the company's ability to raise capital, we remain skeptical around the market's appetite. With that said, the company may be able to attract strategic investment."

BofA cut its price objective on Terran Orbital ( LLAP ) to $1.35 from $7.00 previously after nearly halving the revenue growth estimate for 2024 and keeping gross margin estimates at breakeven levels for 2023 and 2024 vs. prior 20% and 30%, respectively.

Shares of Terran Orbital hit a new 52-week low of $1.23 on Thursday after a 13.29% decline. Short interest on the stock is at 11.67% of total float.

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