Viasat could see its shares skyrocket following a potential spin-off of its defense technology business, which seems increasingly likely, according to JPMorgan. The investment bank upgraded the stock to overweight from neutral. It also hiked its price target for Viasat to $50 from $23, implying 35% upside. “We see a higher likelihood of a separation of the Defense and Advanced Technologies (DAT) segment…including a potential separation of the government and commercial businesses as well as collapsing existing debt silos,” analyst Sebastiano Petti said Tuesday in a note to clients. VSAT YTD mountain Viasat year to date The company’s DAT segment clocked a record backlog of $1.2 billion in the second quarter, up 31% year over year, according to Viasat’s latest earnings report. The division is also poised for growth due to increased reliance on space-based assets for national security purposes and growing demand for resilient communications technologies, among other factors. In a call with analysts last week, Viasat CEO Mark Dankberg entertained calls to spin out the firm’s DAT business, although he declined to put a timeline on decision making. “We’re always evaluating these options,” Dankberg said. “We’re just weighing the benefits.” Wall Street is split on Viasat. The stock has earned four buy or strong buy ratings, four holds and one underperform rating, LSEG data shows. Viasat was up 7% on Tuesday. Shares have surged 366% this year.
