Starlink Mobile Service Could Be Coming to the U.S. Market Soon. Are Top Telecom Stocks in Trouble?
Telecom stocks have been sinking recently on worries that Starlink could pose a threat to their businesses.
Overview
The big moneymaker for Space Exploration Technologies (NASDAQ: SPCX), which is also known as SpaceX, is its Starlink business. That's the one area of the company that generates strong growth, and that's actually profitable. Without it, SpaceX's losses and cash burn would be even worse.
The exciting potential for Starlink has resulted in many telecom stocks struggling this year, as investors worry about what it might mean for the broader sector. An increase in competition could weigh on margins and limit growth even further for companies such as AT&T (NYSE: T) and Verizon Communications (NYSE: VZ) that don't generate much growth to begin with.
Details
Starlink is reportedly looking at expanding its service in the U.S., which may only exacerbate those worries. Are the big players in telecom in trouble, and are their shares likely to fall even lower?
Source
Originally published at www.fool.com.