'New Lunar Logistics Solutions': MDA Space Stock (TSE:MDA) Slides Despite New Selection

Business Insider

5 days ago

On the surface, this should have been great news for space robotics stock MDA Space (TSE:MDA). It was selected by the Canadian Space Agency (CSA) to start up an '…early-phase study for Canada's proposed lunar utility vehicle.' But MDA Space investors were not pleased here at all. They were sufficiently displeased, in fact, to send MDA Space shares nosediving around 2.5% in Tuesday afternoon's trading.
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The lunar utility vehicle project will be focused mainly on mission architecture, reports note, including considering currently-available technology options as well as setting up risk assessment studies. The biggest lesson that MDA is out to learn here is how to build a vehicle that can survive on the moon, which has not only hazardous but highly unusual conditions.
But one part of MDA's study is mostly done for it already. MDA wants to focus on bringing in its Skymaker line of robotics tools, which were initially derived from the Canadarm system. The Canadarm system might be the most famous of Canada's space developments, and was a major part of the United States' space program for fully 30 years. MDA Space CEO Mike Greenley noted, 'This early concept study will help build the foundation for new lunar logistics solutions to support long-term human presence on the Moon, enabling reliable delivery of cargo, resources, and mobility for future missions.'
Now Running the David Florida Laboratory
Meanwhile, MDA Space's plans to make space a bigger part of its operations continue in earnest as it steps into the David Florida Laboratory (DFL). The facility is located in Ottawa, and is Canada's '…only facility for full-scale spacecraft and satellite integration and testing.'
The facility was under the Canadian government's control since the 1970s, and there will be little change in its operations under MDA's control. It will continue to offer its current line of services, including vibration testing, electromagnetic compatibility and more. But this will allow Canada to maintain its sovereignty in the midst of an increasingly complex market for space applications.
Is MDA a Good Stock to Buy?
Turning to Wall Street, analysts have a Moderate Buy consensus rating on TSE:MDA stock based on three Buys, two Holds and two Sells assigned in the past three months, as indicated by the graphic below. After a 207.41% rally in its share price over the past year, the average MDA price target of C$41.50 per share implies 6.82% upside potential.