MDA Space Ltd (NYSE:MDA) stock fell 1.86% (As on April 7, 11:27:37 AM UTC-4, Source: Google Finance) after JPMorgan analyst Seth Seifman initiated coverage of the company with an Overweight rating and $34 price target, which implies 25% upside. MDA’s satellite business has “significant potential for growth” due to new capacity given its exposure to both commercial and military demand, the firm tells investors in a research note. Jefferies also started the name with a Buy rating. MDA’s work spans the iconic Canadarm robot system that assists astronauts in space to low-Earth-orbit satellites for communications in remote regions. In January, it announced a contract with the U.S. Missile Defense Agency linked to America’s Golden Dome missile defense initiative.

Moreover, Seifman says MDA’s communications satellite business has big growth potential, thanks to both commercial and military demand. At the same time, he predicts the legacy robotics business will continue to play an important role. “MDA’s long-standing partnership with the Canadian government has established the company as a leader in space-based robotics,” he wrote in a note to clients on Monday. “MDA is also a supplier to U.S. primes on the Space Development Agency constellations for missile warnings and tracking.” J.P. Morgan was a lead underwriter for MDA’s U.S. initial public offering last month, alongside RBC Capital Markets.

Furthermore, Jefferies initiated coverage on MDA Space Ltd. with a buy rating and set a price target of $41.00. The stock has delivered strong momentum, with shares up 15% over the past week and gaining 61% over the last year. The firm cited the company’s space heritage and technology advances in providing solutions to the satellite, geointelligence, and in-space robotics markets. Analyst Greg Konrad noted these factors position the company in growing sectors. MDA Space maintains a backlog of approximately C$4 billion and a pipeline of C$40 billion. The firm estimates this supports low-double-digit-plus growth and EBITDA margins above 18%.

In other recent news, MDA Space Ltd. reported that its Canadarm3 contract remains unaffected by NASA’s decision to pause the Gateway program. The company clarified that the contract is with the Canadian Space Agency, ensuring continuity in its operations. Additionally, MDA Space raised approximately $41 million through the exercise of an over-allotment option, bringing total gross proceeds from its public offering to about $341 million. In addition, MDA Space is monitoring NASA’s ongoing discussions regarding changes to the Artemis mission as part of a renewed focus on accelerating a return to the Lunar surface.