It is a US based firm which is in the business of providing satellite imagery. It is learnt to have has filed a registration statement with the Securities and Exchange Commission for an IPO on the New York Stock Exchange.
What is the business of DigitalGlobe?
DigitalGlobe is in a unique business. It owns and manages two satellites named QuickBird & WorldView-1. QucikBird was launched in 2001 while WorldView-1 was launched in 2007. Together these satellites are capable of collecting nearly one million square kilometers (more than France and Germany combined) of imagery per day with a resolution below one meter.
Who are the clients of DigitalGlobe?
Big names – Google is one of the premier clients for its Google Maps product. Also Microsoft pays them for Microsoft Virtual Earth. Other than that there are mobile operators like Garmin and Digital map maker Navteq.
The biggest client however, is the US government, which is the main source of revenue. Under the NextView program, the National Geospatial-Intelligence Agency, or NGA, purchases earth imagery content and related solutions from commercial providers on behalf of various agencies within the U.S. government. US government represented 60% of DigitalGlobe's revenue in 2007 and other international intelligence agencies an additional 8%.
So that way, the company seems to be in a safe business.
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Who are the competitors of DigitalGlobe?
Many organizations are in this business – both in US as well as in far off countries like India. GeoEye, SPOT Image, ImageSat International N.V. and the Indian National Remote Sensing Agency.
What are the financial results and valuations of DigitalGlobe?
As per GPS Business News, DigitalGlobe has been profitable since 2006 and from 2005 through 2007 its revenue grew at a compound annual growth rate of 52.3%. In 2007 the company generated revenue of $151.7 million and net income before tax of $37.9 million.
What are the risks while investing in DigitalGlobe IPO?
The market timings are not the best ones to come out with an IPO. Although, it has a completely different business.
Other risk is that US government may move to some other operator, or the scientists at NASA or other organization may find a better source for satellite imagery, then the DigitalGlobe may be out of business.
| One advantage that DigitalGlobe has is a strategic partnership and a contract with the U.S. government as mentioned in its filing: “NGA's minimum earth imagery purchase commitment under the NextView agreement from January 2008 through the expiration of the agreement in July 2009 is $238.0 million, payable in increments of $12.5 million per month”. Investors can bet their money on this IPO from DigitalGlobe | Table of Contents |
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