Amazon


AMZN

has entered agreements with Arianespace, Blue Origin and United Launch Alliance in order to aid the execution of one of its noteworthy initiatives called Project Kuiper, which aims at providing high-speed broadband service on the back of a constellation of low Earth orbit satellites.

Per the terms, the underlined agreements will provide heavy-lift launch services to Project Kuiper. Amazon has secured up to 83 launches from the above-mentioned companies, which will be leveraged to deploy its satellites over a span of five years.

Notably, the e-commerce giant has planned the launches with Arianespace’s Ariane 6, Blue Origin’s New Glenn, and United Launch Alliance’s Vulcan Centaur rockets.

The latest move marks a major step for Amazon’s initiative to provide fast, low-latency and affordable broadband to the unserved and underserved communities worldwide.

Further, it will create jobs in the space industry and will support several suppliers across the 49 states in the United States, and 13 countries in Europe

More on Kuiper

Amazon has been eyeing the satellite and space area for quite some time now in a bid to explore opportunities.

Under Project Kuiper, the company plans to launch a network of 3,236 satellites into space to create an interconnected network.

Further, the 3,236 satellites will be made up of three layers — 784 satellites at an altitude of 590 kilometers, 1,296 satellites will be positioned at the height of 610 kilometers, while the remaining 1,156 satellites will be at an altitude of 630 kilometers.

We note that the Internet is ubiquitous, and its increasing user penetration across the world has created immense growth opportunities for several companies.

Amid this backdrop, we believe that Amazon’s Project Kuiper will likely gain strong momentum. The company’s growing efforts and investments in Kuiper are expected to yield high returns in the long haul.

Intensifying Competition

The recent agreements are likely to strengthen Amazon’s competitive position against SpaceX, which has the same ambitions as the former.

SpaceX runs the Starlink program, with the help of which it intends to deploy tens of thousands of small satellites to provide broadband internet.

Then again,

Alphabet

’s

GOOGL

division Google is making every effort to bolster its presence in the Internet connectivity space via Project Loon and growing investments in satellites.

The search giant is a member of Chile’s Large Synoptic Survey Telescope, which will be fully operational in Cerro Pachon in 2022.

Nevertheless, Amazon is likely to lead the pack by utilizing its improving IoT technologies in the satellite areas.

Zacks Rank & Stock to Consider

Currently, Amazon carries a Zacks Rank #3 (Hold).

Investors interested in the broader technology sector can consider better-ranked stocks like

Advanced Micro Devices


AMD

and

Analog Devices


ADI

. While Advanced Micro Devices currently sports a Zacks Rank #1 (Strong Buy), Analog Devices carries a Zacks Rank #2 (Buy). You can see


the complete list of today’s Zacks #1 Rank stocks here


.

Advanced Micro Devices has gained 51.8% in the past year. The long-term earnings growth rate for AMD is currently projected at 29.1%.

Analog Devices has gained 7.4% in the past year. The long-term earnings growth rate for ADI is currently projected at 12.3%.

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