It was a bad day for the FTSE All-Share Index (1 October). As I type, it’s down 1.7%, which is a fairly big move. It means that a lot of UK stocks will be in the red inside portfolios today.
The reason is a global bond market sell-off, which has put gilt yields at their highest level for many years. Put simply, higher bond yields mean greater competition for riskier assets like UK shares.
However, one AIM-listed stock defying this pressure was Filtronic (LSE:FTC). It rose rose 6% — and shareholders can thank SpaceX (again).
Another record order
Today, Filtronic announced a $68.1m (£51.3m) follow-on order from SpaceX for the supply of its Cerus E-band gallium nitride (GaN) Solid State Power Amplifier (SSPA) units. This beats the record $62.5m order from SpaceX in August 2025.
Admittedly, the above might look like a bowl of alphabet soup with a side of jargon. Breaking it down then:
- Cerus — Filtronic’s product/platform name.
- E-band — a high frequency part of the radio spectrum.
- Gallium nitride — a semiconductor material that can handle higher power and improved efficiency.
- SSPA — the component that amplifies radio signals.
CEO Nat Edington said: “This order provides further evidence of the growing importance of GaN technology in high-frequency communications and reinforces Filtronic’s position at the leading edge of this transition.”
This new order is expected to be mostly fulfilled during FY28, which starts 1 June 2027.
A mushrooming network
As most readers will be aware, Elon Musk’s company blasted Starship — the world’s biggest rocket — into orbit for the first time earlier this week. While there, Starship deployed 26 next-generation V3 satellites for Starlink’s low Earth orbit constellation.
These more powerful versions enable a 10x improvement in downlink capacity and a 22x increase in uplink capacity from the existing V2 satellites. Moreover, Starship’s designed to deploy around 60 of them a launch!
Consequently, Starship should massively increase the network’s size and added customer capacity. Indeed, SpaceX estimates 20x the capacity per Starship launch into Starlink as compared to a Falcon 9 launch of V2s.
So how does Filtronic fit into the picture? Well, SpaceX needs its next-generation, proprietary GaN E-band technology for its mushrooming Starlink constellation, specifically its gateway ground stations.
As SpaceX invests heavily in expanding Starlink and the global ground station infrastructure it requires, Filtronic’s long-term growth outlook appears increasingly bright.
It’s not out of the question that at some point, Starlink will deliver a majority of the world’s internet, at least in countries where we’re allowed to operate, which is the vast majority of countries.
Elon Musk
Down 47%
Is Filtronic worth considering? Potentially, though a lot of expected growth already seems priced in after the stock’s 2,000% surge since mid-2023. It’s now trading at around 60 times forecast FY28 earnings.
Beyond the punchy valuation, there’s also customer concentration risk, with SpaceX accounting for the bulk of revenue.
At the same time, the fact that the vertically integrated space giant chose Filtronic as a supplier is a massive endorsement of its gallium nitride technology. So it’s no surprise to see other satellite communications and defence firms very interested in it.
With the stock still down 47% since May, I think it’s worth checking out.
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Ben McPoland owns shares of SpaceX.
This story originally appeared on Motley Fool
