This Satellite-Communications Stock In Cathie Wood Portfolio Has Given Better 5-Year Returns Than Apple, Netflix, Amazon

Iridium Communications Inc’s IRDM sharp subscriber growth over the past four years has caught the popular money manager Cathie Wood’s attention and despite the satellite communications provider’s recent annual loss, the stock has fetched handsome returns over the years.

Iridium’s subscribers grew to nearly 1.48 million in 2020, a CAGR growth of about 12% since 2016. The company reported a narrower net loss of $56.1 million in 2020, compared with $162 million a year ago. Revenue climbed to $583.4 million in 2020, a CAGR growth of 6.11% since 2016.

Wood’s investment firm Ark Invest has piled up 12.3 million shares — worth $578 million —  via three of its active exchange-traded funds — namely, the Ark Innovation ETF ARKK, the Ark Autonomous Technology & Robotics ETF ARKQ and the Ark Space Exploration & Innovation ETF ARKX. 

Iridium ranks third and fifth in ARKX and ARKQ’s portfolio of thirty-six and forty stocks, respectively. It ranks twenty-third in ARKQ’s portfolio of forty-eight stocks. 

After months of buying shares in the McLean, Virginia-based Iridium, Ark Invest booked some profit with two-straight sales this week as shares traded up more than 15% following rumors that Apple Inc's AAPL new iPhone will use a satellite connection to enable emergency calls and texts where cell service is not available.

The New York-based investment firm has sold 86,447 shares in Iridium so far this week. 

See Also: Apple's Plans With Bringing Satellite Capabilities in iPhone Related To Emergency Reporting Features

How The Returns Stack Up: Since 2006, the stock seen as a rival to Globalstar Inc GSAT, has fetched stellar returns topping those of Apple, Netflix Inc NFLX and Amazon.com Inc AMZN.

Iridium has fetched 21% return so far this year and is up from $6.94 a share in September 2016 to $46.91 as of Thursday’s close, a return of 529.66%.

Apple shares have fetched 19.06% returns so far this year and the stock is up from $25.78 a share in September 2016 to $154.07 as of Thursday’s close, a return of 436.27%.

Netflix shares have fetched about 14.28% returns so far this year and the stock is up from $99.48 a share in September 2016 to $597.54 as of Thursday’s close, a return of 500.66%.

Amazon shares have fetched 9.34% gains so far this year and the stock is up from $778.52 a share in 2016 to $3,484.16, a return of 347.5%.

Photo: Courtesy of Iridium