Terran Orbital's Prospects Brighten with ITU Waiver for Rivada's Satellite Constellation, Analyst Says

Benchmark analyst Josh Sullivan reiterates Terran Orbital Corp LLAP with a Buy and a $12 price target.

LLAP’s $2.4 billion order for satellite buses from Rivada took a step forward this week after a favorable International Telecommunications Union (ITU) ruling. 

The ITU has waived a requirement to have 10% of Rivada’s proposed 576 satellite constellation launched by September. Now Rivada can proceed with LLAP’s expected timeline assuming 144 satellites launch by June of 2026 and another 144 satellites launch by September 2026. 

The ITU waiver requires confidence in Rivada’s funding outlets, manufacturing, and launch. 

Given the proposed constellations, the ITU requires a financial stability review to avoid radio spectrum squatting. 

The ITU believes Rivada is well positioned, which means the $2.4 billion LLAP order moves forward. 

Sullivan anticipates LLAP beginning to show activity related to the massive order beginning in 3Q:23. 

Rivada must have 50% of the total constellation launched (buses manufactured by LLAP) by mid-2026 or risk losing priority Ka-band spectrum. 

Rivada plans by 2028 to have a ~600 satellite constellation which will also require continuous replacement of new LLAP buses. 

Net-net, LLAP’s transformational $2.4 billion order moves forward, which will begin to drive results this year.

Price Action: LLAP shares traded lower by 0.71% at $1.42 on the last check Thursday.