Eutelsat’s Record Rally Pauses as Investors Weigh SpaceX Hype Against Analyst Skepticism

Shares pull back slightly after a 31% weekly gain, but remain 126% above 52-week low. Analyst targets lag at €2.40, highlighting valuation disconnect.

After a blistering weekly surge that lifted the stock to its highest level in over a year, Eutelsat shares took a modest step back on Friday. The pullback was brief — the stock dipped to around €3.69 intraday before closing at €3.74, down just under 1%. That minor retreat does little to dim the glare of a 31% weekly gain, or the eye-popping 109% advance since the start of the year. The shares now trade 126% above their 52-week low of €1.65.

The rally was ignited by two powerful forces. The first: the long-awaited IPO of Elon Musk’s SpaceX, which has sent a wave of speculative enthusiasm across the satellite sector. The second: Eutelsat’s own fundamental pivot, underpinned by the successful completion of a €5 billion refinancing package designed to strengthen its balance sheet as it plows investment into low-earth-orbit (LEO) connectivity.

SpaceX has filed its prospectus with the SEC, targeting a valuation between $1.75 trillion and $2 trillion and seeking to raise $75 billion in what would be the largest IPO in history. Trading is expected to begin on June 12, with a roadshow kicking off around June 4. For Eutelsat — one of only two operators worldwide with a fully operational LEO constellation, alongside Starlink — the announcement has turned the stock into a proxy play for the entire satellite-internet theme. “The SpaceX valuation is far above what is currently being attributed to European satellite companies,” notes Stéphane Beyazian of ODDO BHF. “Some investors are hoping for a re-rating of the whole sector.”

Yet the euphoria has thrown up a glaring disconnect between market price and analyst expectations. The average analyst price target for Eutelsat stands at €2.40 — roughly 36% below Friday’s close. Even BNP Paribas, which recently lifted its target from €2.10 to €2.70, retains a “Neutral” rating. While the European telecom sector has added about 25% this year, Eutelsat has more than doubled, leaving valuations stretched by conventional metrics.

Underneath the speculative froth, however, is a substantive corporate story. Eutelsat’s €5 billion refinancing, comprising a €1.5 billion bond issue and a capital increase backed by major shareholders, is now fully in place. Management expects net debt to run at roughly 2.7 times EBITDA for the current fiscal year. The strategy is clear: finance the shift from legacy video services to next-generation LEO connectivity. In the third quarter, LEO revenue surged 65% on an adjusted basis, while total group revenue came in at €293 million — down 2.3% as reported, but up 3.1% on a like-for-like basis. The traditional video segment continued its decline, falling 15.7%. For the full year ending June 30, the company expects LEO revenue to grow around 50%.

The technical picture has cooled after the explosive breakout. The Relative Strength Index briefly hit 78 during the rally and has since eased to 38, signaling that overheated conditions have normalized. The stock continues to trade well above all key moving averages — the 200-day line sits 42% below the current price. The former resistance zone at €3.02 has now flipped into the first support level, with the next overhead hurdle around €4.00. Short interest remains negligible at just 2.17% of capital, suggesting little bearish conviction.

Looking ahead, the immediate catalyst will be the SpaceX roadshow beginning June 4. Any signals on valuation or timing could spark fresh volatility in Eutelsat shares. After that, the company’s own fiscal year closes on June 30, with full-year results expected on August 7. By then, the market will have to decide whether this year’s rally is a lasting re-rating or a temporary trade on SpaceX coattails. For now, the satellite sector is flying high — but the landing may be bumpy if earnings don’t catch up with the altitude.