by Fred Fuld III
Do you believe UFOs really exist? If so, would you like to invest in the UFO industry? Unfortunately, you can’t just yet but you can invest in the next best thing, space travel.
The business of traveling to outer space may be the next big long term industry for investors. But you may be asking, what are the best stocks to play this investment theme?
Unfortunately, a few of these companies are privately held, but there are some, many of which are small corporations, which are close to space pure plays.
One of these companies is Maxar Technologies (MAXR) which has three divisions, space systems, imagery, and services. The space systems division provides satellites, satellite payloads, and antennas. This Colorado based company has been around since 1969. The stock trades at 42 times forward earnings by recent earnings have been negative. It has a very favorable price to sales ratio of 0.21, and sells at 76% of book value. This $442 million market capitalization company even pays a dividend, with a yield of 0.54%.
Another space related company with a much larger market cap of $5.3 billion, is Viasat (VSAT), which designs and develops satellites along with many types of communication services. The company, which has generated negative earnings, trades at more than two and a half times sales and book value. It does not pay a dividend.
The Englewood, Colorado company EchoStar (SATS) owns and leases in-orbit satellites. The stock has a forward price to earnings ratio of 28 and trades at 98% of book value.
There are several other companies that might fit into the space category such as IntelSat (I), Trimble (TRMB), and Iridium (IRDM). However, a better strategy might be to invest in the Procure Space ETF (UFO), which has cornered a great stock ticker symbol.
This ETF owns all of the above stocks plus a couple dozen more that have ties to the space industry. UFO just started trading this year.
Disclosure: Author didn’t own any of the above at the time the article was written.