SpaceX Wireless Network vs. Verizon and AT&T: What Satellite Competition Means for Telecom Investors

SPEAKER_1 (0:01)

This is InvestTalk from KPP Financial, helping investors make sense of the markets one day at a time. Here's your host, Luke Guerrero.

Luke Guerrero (0:17)

Good afternoon, fellow investors, and welcome back to InvestTalk. I'm your host, Luke Guerrero, and I'll be with you on this Monday, October 19th, 2026

As we talk about all the moving parts in the market, as well as the important financial news, and most importantly, answer your finance and investment questions. Now, before we move forward, I do want to give you a quick reminder that our first in-person InvestTalk retirement summit, sorry, is, well, just five days away now, and there are very limited spots left. It is a free event, you do have to head over to investtalk.com and register. So if you're interested in going to the InvestTalk Retirement Summit, I encourage you to sign up today. All right. In just a bit, I'll talk about today's market performance and run down our show topics. But why don't we tackle this caller question now?

SPEAKER_4 (1:15)

Hey, guys, this is Darren Charlotte.

SPEAKER_5 (1:17)

I've got a quick question for you.

SPEAKER_4 (1:19)

I'm looking at Celanese Corporation.

SPEAKER_5 (1:21)

Take it from more CE.

SPEAKER_4 (1:24)

It's a good opportunity to get in right now. I was just curious what your thoughts are. Appreciate it.

SPEAKER_5 (1:29)

Thanks. Bye.

Luke Guerrero (1:32)

Let's take a look at Celanese Corporation. That is ticker CE. It's a roughly $5.2 billion market cap company, puts it in the higher end of the small cap range. What it does is it has a bit of a focus on specialty materials, as well as global chemicals. So they have high-performance plastics, which is used in electronics and in auto production, medical production. They have sec acid vinyl related products as well.

Recently, it's been ranging here for a bit. If you look at the chart, if you look at the price movements, at the end of 2024, there was a huge drop-off. Volume started to spike far beyond what you saw going into 2020, and it dropped from about $150 a share to where it trades today at $47.88.

Now, with this drop-off, you've had many quarters of disappointing earnings until this most recent quarter. Company actually had its highest adjusted earnings per share in three years. Revenue was a hair below consensus, but it was still at net sales of $2.8 billion. That was 18% growth year over year.

One thing that the market obviously didn't like, though, was guidance was guided, couldn't think of another word, downward pretty sharply, because they're seeing some supply-related benefits fading, and generally just seeing raw costs rise. We're seeing that across the market. And so shares fell about 7% on this guidance, on some of the leverage concerns that they have. I mean, total long-term debt is $11.65 billion. And so in spite of this earnings power kind of recovering, in spite of what was record margins in their largest division, that engineered materials division, in spite of all this, I think that when you have a company whose debt levels are high, whose dividend was just cut, whose business is cyclical, and whose trailing 12 months gap earnings is still pretty deeply negative, it doesn't give you a lot of confidence that now is a time to enter positions. So, for CE, Celanese Corporation, gonna have to pass. Thanks for the call. What a great show for you on Friday. We looked into this story about the Supreme Court taking on your 401k. We also answered a listener question on a ticker symbol GE, which is GE Aerospace. So if you want to learn more about that Supreme Court case and more about General Electric, I encourage you to check out Friday's episode of Invest Talk. Remember, the best way to never miss an episode is to subscribe to Invest Talk wherever you get your podcasts. On to today, where my main focus point is about SpaceX, not the rocket division, but instead about their desire to take on the big boys in wireless networks, take on Verizon and AT&T. What does this potential satellite competition mean for telecom investors? Verizon actually saw its stocks suffer its worst single day since 2002, after this report came out of SpaceX planning a US wireless network. It, for a lot of reasons, sent some shockwaves through the entire telecom sector. This could be a lesson about when a disruptive competitor threatens your core business model of really companies that are worth hundreds of billions of dollars. What are the structural implications? Not just for these companies, but for you if you are invested in telecoms.

We also have a couple more stories to bring you today, including one on the difference between, or rather how even though wages are growing, wealth is not, a lot of that because fewer Americans are owning stocks. Another story on credit union rules being rewritten, and should we have time at the end of the show, talk a little bit about what is happening in the heartland to America's farms. We also have some voice bank calls ready to play, including one on short interest, and another on Curtiss-Wright Corporation, that's ticker CW, as well as some questions that came in from the comment section of the Invest Talk YouTube channel, and hopefully some live calls throughout the show.