Iridium Communications Inc. (IRDM) stock analysis

P/E below its 5-year median

Iridium Communications's P/E of 31.3 is below its own 5-year median of 38.0.

P/E above the industry

Iridium Communications's P/E of 31.3 is above the Communications median of 14.4.

EV/EBITDA above its 5-year median

Iridium Communications's EV/EBITDA of 12.5 is above its 5-year median of 11.3.

P/B above the industry

Iridium Communications's price-to-book of 8.70 is above the Communications median of 2.59.

Trading above fair value

The share price of $47.29 is above our fair value estimate of $38.24.

Margin of safety under 20%

The price is 23.7% above fair value, so there is no margin of safety.

Revenue growing under 10% a year

Revenue grew 6.5% a year over the last three fiscal years, short of the 10% we look for.

EPS growing 10%+ a year

Diluted EPS grew 147% a year over the last three fiscal years.

Earnings acceleration

Needs positive net income now, a year ago and five years ago.

Growing faster than the industry

Revenue grew 3.6% over the last twelve months; the Communications median is 3.0%.

Guidance unchanged

The latest outlook (full-year 2026 OEBITDA, Apr 23, 2026) was maintained, so it neither adds nor takes away points.

Gross margin trend

This company does not report gross profit.

Return on equity under 15%

Return on equity was 31.7% over the last twelve months and averaged 7.8% over five years; we look for 15% on both.

Return on capital over 10%

Return on invested capital was 30.1%, above the 10% that usually covers the cost of capital.

Return on equity above the industry

Iridium Communications's return on equity of 31.7% is above the Communications median of -3.1%.

Earnings over 5 years

Needs positive net income five years ago and in the latest year.

Net margin above its 5-year average

Net margin was 18.1% over the last twelve months, against a 5-year average of 5.7%.

Net margin above the industry

Iridium Communications's net margin of 18.1% is above the Communications median of -10.4%.

No debt

Iridium Communications has no borrowings on its latest balance sheet.

Debt not rising

With no debt today, leverage cannot have risen.

Debt covered by cash flow

There is no debt to cover.

Interest well covered

No meaningful interest expense to cover.

Short-term assets don't cover short-term debts

Current assets are 0.91 times current liabilities.

Elevated bankruptcy risk

The Altman Z-score is 1.54; above 3 is the safe zone and below 1.8 the distress zone.

Pays a dividend

Iridium Communications paid dividends worth 1.3% of the share price over the last twelve months.

Yield below Treasuries

The 1.3% yield is below the 4.4% on a 1-year Treasury.

Yield below the top quarter

The top quarter of US dividend payers yield 3.8% or more; Iridium Communications yields 1.3%.

Dividend stability

Fewer than five years of dividend history.

Covered by earnings

Dividends take 39.8% of net income.

Covered by free cash flow

Dividends take 23.4% of free cash flow.