The Kleos Space SA (ASX: KSS) share price marched ahead today despite a lack of announcements during the trading session. The satellite reconnaissance company’s shares finished up 6% higher to 71 cents per share.
With no news out today, it might be worth looking at recent developments to understand what could have the market excited.
Kleos share price tapping US interest?
The volume of shares traded today (more than 1.13 million) was abnormally high considering its last announcement was on 12 March. At that time, Kleos provided an investor presentation specifically for United States public market investors. Since that release, the company’s shares have gained nearly 14%.
Kleos’ service is focused on collecting radio spectrum data via orbiting satellites. This information is beamed back to Earth, where it is then processed with the Kleos’ algorithms.
From there, the valuable data is delivered to its clients. Currently, those clients are mostly Five Eyes organisations and agencies homing in on illegal activities.
There are a few reasons the presentation could be driving shares higher. Firstly, there is potential that some US investors liked the proposition and have gone ahead and invested. Secondly, as the information is available to the ASX, potentially local investors found a few valuable nuggets in the slides.
Lastly, the second satellite cluster launch around mid-year is fast approaching. The nearing of that particular event could have investors scrambling to accumulate.
SpaceX Starship seems feasible
Another potential catalyst for the Kleos share price is the recent developments in Space X’s Starship.
The 50m tall rocket has been under development for years now as an ambitious endeavour to reduce space flight costs further. On 5 March, the rocket managed to make a return landing on the launch platform before later exploding.
SpaceX released new high definition video of Starship SN10’s landing earlier this month: https://t.co/X9DiV5w6Ow pic.twitter.com/1JZdcJY9f6
— Michael Sheetz (@thesheetztweetz) March 17, 2021
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Due to the rocket’s size, if successful, it would be able to carry a far greater number of satellites/people in the future. Thereby decreasing the per kilogram cost for sending into space.
This is an exciting potential for a company like Kleos, as it may significantly reduce one of its highest operation costs – getting the satellite into space to begin with.
Accounting for today’s gain in the Kleos share price, the company now has a market capitalisation of $107 million.
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Motley Fool contributor Mitchell Lawler has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.
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