EchoStar Corp. (NASDAQ:SATS) stock is trading higher on Tuesday.
The satellite communication company is reportedly engaged in talks to sell some of its wireless spectrum to Verizon Communications Inc. (NYSE:VZ).
Bloomberg reported that the discussions center on EchoStar's AWS-3 licenses, which are valuable for carrying 5G signals. The company has assigned a carrying value of $9.8 billion to the spectrum in regulatory filings.
While a deal with Verizon may not reach those levels, investors reacted positively to the potential transaction.
In August, EchoStar inked a landmark $23 billion deal to sell a significant portion of its wireless spectrum portfolio to AT&T Inc. (NYSE:T).
In September, EchoStar announced that it would sell its AWS-4 and H-block spectrum licenses for approximately $17 billion to Elon Musk's SpaceX.
The deal consideration consists of up to $8.5 billion in cash and up to $8.5 billion in SpaceX stock, valued as of the date of entry into the definitive agreement.
Bloomberg noted Tuesday that the potential sale follows EchoStar's recent strategy shift. Last month, the company began offloading spectrum holdings to help avoid bankruptcy and address a Federal Communications Commission investigation into whether it was deploying the airwaves it had secured quickly enough.
Another portion of the AWS-3 band is scheduled to be auctioned by the federal government next year.
Citing a recent interview, the report highlighted that EchoStar CEO Hamid Akhavan signaled the company's willingness to continue monetizing parts of its spectrum portfolio, including AWS-3 licenses. He noted that EchoStar no longer intends to build out a complete nationwide wireless network to compete with industry giants.
Price Action: SATS stock is up 6.59% at $78.50 during the premarket session at the last check on Tuesday.
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