EchoStar Corporation (SATS) DCF Valuation & Fundamental Primer
EchoStar Corporation (SATS) currently trades at $112.24 with an enterprise value of $3.32B. Our proprietary institutional model rates EchoStar Corporation at 58/100 (Grade: B · Mixed Fundamental Profile). The current market price prices in an implied 5-year revenue CAGR of 17.8% vs. historical growth of 20.0% (Fairly Priced to Fundamentals).
Institutional fundamental teardown of EchoStar Corporation (SATS) covering SEC 10-K/10-Q cash flow conversion, SBC dilution friction, and Reverse-DCF valuation hurdles.
EchoStar Corporation (SATS) 3-Scenario DCF Valuation Range
Stress-test SATS's 5-year growth, target FCF margin, WACC, terminal methodology, and SBC/dilution friction in real time.
Split between 5-Year Explicit Cash Flows and Discounted Terminal Value
2D Institutional Valuation Sensitivity Heatmap
Implied share price & upside/downside spread across 25 valuation states (Current Price: $112.24).
| WACC \ Terminal | 1.5% | 2.0% | 2.5% | 3.0% | 3.5% |
|---|---|---|---|---|---|
| 8.5% | $42.23 -62% | $51.00 -55% | $61.23 -45% | $73.32 -35% | $87.82 -22% |
| 9.3% | $27.96 -75% | $34.86 -69% | $42.80 -62% | $51.99 -54% | $62.79 -44% |
| 10.0% | $16.22 -86% | $21.77 -81% | $28.07 -75% | $35.26 -69% | $43.56 -61% |
| 10.8% | $6.41 -94% | $10.95 -90% | $16.04 -86% | $21.78 -81% | $28.32 -75% |
| 11.5% | $0.00 N/M | $1.84 -98% | $6.03 -95% | $10.70 -90% | $15.96 -86% |
Institutional Software Quality Scorecard (58/100 · Grade B)
Viable recurring software business but carries notable dilution, lower margins, or higher leverage.
Positive FCF but lower conversion efficiency due to capex or timing
Minimal dilution friction; management compensation aligned with shareholders
Sub-par gross margins; higher cost of delivery or hardware/services mix
Moderate leverage or cash burn; monitor liquidity runway
Core Investment Strengths & Moats
- Low dilution friction: SBC is only 0.2% of revenue
Key Operational & Dilution Risks
- Lower software gross margins (36.0%), indicating higher hosting or service delivery drag
Reverse-DCF Solver: What Growth is Priced Into SATS?
Market implies 17.8% annual revenue growth over next 5 years (18.0% dilution-adjusted), in line with company run-rate.
Headline Reverse-DCF ignores Stock-Based Compensation (0.2% of revenue) and annual share dilution (0.0%/yr). Accounting for both requires 18.0% 5-year revenue CAGR to justify $112.24/sh on a true per-share economic cash flow basis.
EchoStar Corporation (SATS) 5-Year Fundamental Forecast
| Statement Line Item | TTM Audited Base | TTM | Y1 | Y2 | Y3 | Y4 | Y5 |
|---|---|---|---|---|---|---|---|
| Revenue | $15.83B | $15.83B | $18.20B | $20.93B | $24.07B | $27.68B | $31.83B |
| Gross Profit | $5.69B | $5.69B | $6.54B | $7.52B | $8.65B | $9.95B | $11.44B |
| Operating Income (EBIT) | $-304.1M | $-303.8M | $-349.4M | $-401.8M | $-462.1M | $-531.4M | $-611.2M |
| Stock-Based Compensation (SBC) | $36.4M | $36.4M | $41.9M | $48.1M | $55.4M | $63.7M | $73.2M |
| Unlevered Free Cash Flow (FCF) | $145.1M | $145.6M | $167.4M | $192.5M | $221.4M | $254.6M | $292.8M |
| SBC-Adjusted True Cash Flow | $108.7M | $109.2M | $125.6M | $144.4M | $166.1M | $191.0M | $219.6M |
Software & Cloud Services Peer Comparables & Rule of 40 Regression
Rule of 40 vs. EV / Revenue Multiple Regression
OLS Fit: EV/Rev = -7.3 + 0.38 × (Rule of 40) · R² = 62%Stocks below the gold regression line trade at a discount relative to their Rule of 40 compounding efficiency.
| Company | Ticker | Market Cap | TTM Revenue | Gross Margin | FCF Margin | Rule of 40 | SBC % Rev | EV / Rev |
|---|---|---|---|---|---|---|---|---|
| EchoStar Corporation | SATS | $32.31B | $15.83B | 36.0% | 0.9% | 20.9% | 0.2% | 3.8× |
| ServiceNow | NOW | $152.61B | $10.98B | 79.2% | 31.1% | 54.2% | 15.9% | 13.9× |
| Workday, Inc. | WDAY | $50.35B | $8.00B | 75.0% | 27.4% | 43.9% | 19.0% | 6.4× |
| Salesforce | CRM | $217.10B | $37.90B | 77.2% | 32.8% | 42.8% | 8.4% | 5.8× |
| Datadog | DDOG | $46.05B | $2.68B | 80.8% | 31.1% | 57.7% | 21.3% | 17.4× |
| Snowflake Inc. | SNOW | $71.79B | $3.63B | 66.5% | 25.2% | 57.7% | 40.8% | 20.0× |
| Hubspot | HUBS | $19.89B | $2.63B | 85.0% | 21.3% | 52.7% | 19.2% | 7.7× |
| Peer Cohort Median Benchmark (N=6) | 78.2% | 29.2% | 53.5% | 19.1% | 10.8× | |||
EV / Revenue Multiple Compression Stress Test
| Multiple Scenario | EV / Revenue | Implied Enterprise Value | Implied Equity Value | Implied Share Price | Delta vs Current |
|---|---|---|---|---|---|
| Current Multiple | 3.8× | $60.30B | $32.31B | $112.24 | 0.0% |
| -20% Multiple Compression | 3.0× | $48.24B | $20.25B | $70.35 | -20.0% |
| -35% Multiple Compression | 2.5× | $39.20B | $11.21B | $38.93 | -35.0% |
| Software Baseline Floor (5.0× EV/Rev) | 5.0× | $79.13B | $51.14B | $177.63 | +31.2% |
Frequently Asked Questions: EchoStar Corporation (SATS) Valuation
What is EchoStar Corporation (SATS)'s intrinsic DCF valuation and implied share price?
Based on audited SEC 10-K/10-Q filings and a 5-year 3-statement discounted cash flow (DCF) model, EchoStar Corporation (SATS) has a Base Case implied value of -$85.70 per share (with a Bear Case of -$91.77 and a Bull Case of -$77.89), compared to its current price of $112.24. The model discounts projected free cash flows at a 10.0% WACC and a 2.5% terminal growth rate.
What is EchoStar Corporation (SATS)'s Rule of 40 score and Free Cash Flow margin?
EchoStar Corporation achieves a Rule of 40 score of 20.9%, combining a 20.0% revenue growth run-rate with a 0.9% TTM free cash flow margin on $15.83B in trailing twelve-month revenue. In the Software & Cloud Services peer cohort, the median Rule of 40 benchmark is 53.5%.
What revenue growth rate is priced into SATS stock according to Reverse-DCF analysis?
At $112.24 per share (Enterprise Value of $60.30B), our Reverse-DCF solver indicates the market is pricing in a 5-year implied revenue CAGR of 17.8%, compared to EchoStar Corporation's historical CAGR of 20.0%. Overall market expectations are rated as "Fairly Priced to Fundamentals".
How does EchoStar Corporation compare to Software & Cloud Services software peers?
EchoStar Corporation (SATS) earns an institutional Software Quality Score of 58/100 (Grade B — Mixed Fundamental Profile). Across its Software & Cloud Services peer group (NOW, WDAY, CRM, DDOG, SNOW), the cohort trades at a median EV/TTM Revenue multiple of 10.8× and a median gross margin of 78.2%.
How does Stock-Based Compensation (SBC) impact EchoStar Corporation (SATS)'s valuation?
EchoStar Corporation recorded $36.4M in TTM stock-based compensation (0.2% of revenue). When treating SBC as a cash-equivalent compensation expense, EchoStar Corporation's SBC-adjusted free cash flow yield is 0.3%, scoring 25/25 on our Shareholder Dilution Friction pillar.