Amazon (AMZN) just completed a major new deal, and Goldman Sachs thinks investors need to see the bigger picture.
To get an idea, Amazon entered into an agreement to acquire Globalstar, which allows Amazon Leo to provide direct-to-device (D2D) services in its low Earth orbit satellite network and expand mobile coverage to customers in remote areas, the company’s press release shared. Amazon and Apple reaffirmed their agreement, which will enable Amazon Leo to enable satellite services on other Apple devices.
After the news, Goldman reiterated his buy rating and left his 12-month price target for Amazon stock at $275. With shares of the e-commerce giant at $249.02 in the report, that points to a 10.4% increase from current levels.
Instead of treating it as a one-off M&A topic, Goldman Sachs sees the move as a big play in satellite-based connectivity, and a warning shot to rivals.
Amazon has already dropped more than $100 billion on its satellite effort, Leo, formerly known as Project Kuiper.
The company says the AI behemoth is marching toward commercialization, and the Globalstar deal gives it access to more assets, more spectrum, and a tighter partnership with Apple.
The development adds to the massive buzz Amazon stock has recently built.
Amazon shares have outperformed the broader market, gaining 16.4% over the past month and 17.6% over the past six months.
Project Leo is Amazon’s attempt to build a satellite network that acts as a cell tower in the sky.
That’s huge because it brings customers who previously couldn’t access traditional networks into the ecosystem.
This fenced “internet bridge” can reach rural, business, and government users that are often outside of traditional coverage areas.
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The purchase of Globalstar accelerates these efforts and, among others, fits into Amazon’s broader strategy of connecting to Amazon Web Services (AWS). That would enable customers to push satellite data straight into storage, AI tools, analytics, and much more.
In perspective, Amazon’s cloud service generated $35.6 billion in sales in total company value of $213.4 billion in Q4 2025 (16.7% of total sales).
Separately, Synergy Research Group said AWS held a 28% share of the global cloud infrastructure market in the same quarter, maintaining its lead over Microsoft and Google.
Amazon’s Globalstar deal looks incredibly smart on paper, but it’s not a bad deal.
Here’s what can go wrong.
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The main problem is still start the cadence. Amazon has launched only 243 of the 3,236 satellites it has proposed, so the purchase alone does not solve the bottleneck.
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I price tag is a big deal, as the deal’s value sits at around 40 times sales in 2026 for a capital-intensive business.
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Amazon plans about 200 billion dollars in 2026according to CNBC, mainly because of AWS and AI, it adds another expensive project to the full spending cycle.
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The old one face the dangers remains, including litigation, regulatory approvals, and unknown liabilities, which could delay closing.
Amazon will buy Globalstar for $90 per share in a combination of cash and stock in a $11.57 billion deal, according to Reuters, giving it access to the latter’s powerful satellite assets, infrastructure, and spectrum portfolio.
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It covers Globalstar’s existing spectrum licenses for mobile satellite services (MSS), as well as non-geostationary orbit (MGSO) and device-to-device (D2D)-capable satellites.
Apple’s piece is equally important, if not more so.
With the acquisition, Amazon will take its current deal with Apple, enabling Emergency SOS on the iPhone 14 or later and the Apple Watch Ultra 3, a press release shared.
In addition, it will enter into an extended agreement, where Amazon Leo will provide satellite services for Apple devices going forward.
That gives Amazon a live use case with a blue-chip partner, paving the way for other companies of similar scale to follow.
Good is straightforward.
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Amazon is buying the interceptor by collecting rare spectrum, a low-Earth-orbit network that works, and live D2D capabilities, as well as other infrastructure that will enable Leo’s rollout of its mobile service in 2028.
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Amazon can expand its reach beyond traditional wireless coverage, opening the door to additional voice, text, and data services.
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Project Leo is in line with Amazon’s broader AWS strategy, risking spectrum rights, overcharging plans, and improving returns on constellations.
Wall Street’s consensus on Amazon stock remains bearish, with analysts assigning an average price target of $281.18, implying a 12.22% upside from current levels.
The wide range suggests both optimism and caution, with a high target of $360 and a low of $175.
In addition, Amazon stock trades at 32.4 times forward earnings, nearly 100% above the industry average, according to Seeking Alpha. Historically, such high valuations are not new, and compared to its five-year average, the stock is trading at a 34% discount.
Related: Goldman Sachs just found a reason to like Nvidia stock again
This story was originally published by TheStreet on April 19, 2026, where it appeared first in the investing category. Add TheStreet as a favorite source by clicking here.
