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Globalstar (GSAT)

This communications company beat analysts’ estimates last quarter, earning two cents per share versus the estimated loss of three cents.

Globalstar (GSAT)
From The Turnaround Letter

Our top pick for 2016 is Globalstar (GSAT), a leading provider of satellite-based communication services. Traditionally, most of Globalstar’s business has consisted of satellite telephone and data services.

However, the upside potential in the stock going forward comes from the value of the radio spectrum that the company controls. Globalstar is developing this spectrum to offer Wi-Fi through what it calls Terrestrial Low Power Service (or TLPS). As the traditional spectrum used for Wi-Fi becomes overcrowded in many areas, there could be a substantial market for TLPS, both in the U.S. and globally.

The process for getting Federal Communications Commission approval for this new Wi-Fi technology has dragged on longer than expected, which caused many holders of the stock to lose patience and sell. Then yearend tax loss selling pushed the stock down further over the last couple of months. The controlling shareholder, who is a savvy tech and telecom investor, has been buying more stock recently. In addition, there are signs that the FCC may be nearing a favorable decision, which should give the stock a big boost.

George Putnam III, The Turnaround Letter,, 617-573-9550, January 4, 2016