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ASTS Skyrockets 800% in Past Six Months: Should You Ride the Wave?
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AST SpaceMobile, Inc. (ASTS - Free Report) has gained a stellar 800% over the past six months compared with the industry’s growth of 5.8%. It has also outperformed its peers like Aviat Networks, Inc. (AVNW - Free Report) and Comtech Telecommunications Corp. (CMTL - Free Report) over this period.
This Midland, TX-based broadband service provider is reportedly developing the first and only global cellular broadband network in space based on its extensive IP and patent portfolio. With a diverse portfolio of more than 3,400 patent and patent-pending claims worldwide for the direct-to-cell satellite ecosystem from space to Earth, AST SpaceMobile’s remarkable transformation in recent months offers a competitive edge across the broader technology market.
One-Year Price Performance
Image Source: Zacks Investment Research
What Lies Behind ASTS' Meteoric Rise?
In mid-May this year, AT&T Inc. (T - Free Report) and AST SpaceMobile entered into a definitive commercial agreement, extending until 2030, to provide a space-based broadband network directly to everyday cell phones. The integration of space-based direct-to-mobile technology is designed to complement and integrate with AT&T’s existing mobile network. This approach aims to provide customers with connectivity in locations previously deemed unreachable, enhancing AT&T’s industry leadership in utilizing emerging satellite technologies.
Later in the month, Verizon Communications Inc. (VZ - Free Report) became the second major mobile network operator (MNO) partner in the United States to collaborate with AST SpaceMobile by making a $100 million commitment for satellite direct-to-cellular service for its customers. The two back-to-back deals sent the ASTS stock price soaring. It further enhanced cellular coverage in the United States, essentially eliminating dead zones and empowering remote areas of the country with space-based connectivity.
Bluebird Satellites Propelling ASTS to Greater Heights
AST SpaceMobile recently announced the successful completion of its first five commercial satellites, marking a key advancement in developing a space-based mobile network infrastructure. Dubbed Bluebird, these satellites are equipped with the largest-ever commercial communications arrays spanning 693 square feet. They will be deployed in low Earth orbit to potentially offer non-continuous service across the United States using more than 5,600 cells within the premium low-band spectrum.
This achievement follows the success of AST SpaceMobile's in-orbit BlueWalker 3 satellite. It marks significant progress in the company's mission to create a space-based cellular broadband network that can directly link with mobile devices, eliminating the need for ground-based infrastructure. By expanding its connectivity to remote areas, the company aims to ensure that more people have access to vital communication services.
The Bluebird satellites, having passed stringent testing to meet the high standards of space operations, have been successfully launched today into low-earth orbit from Cape Canaveral, Florida, aboard a SpaceX rocket.
Estimate Revision Trend of ASTS
The Zacks Consensus Estimate for AST SpaceMobile for 2024 and 2025 has widened 151.2% and 165.4%, respectively, to a loss of $1.03 and a loss of 51 cents per share over the past year. The negative estimate revision depicts pessimism about the stock’s growth potential as investors remain skeptical about the success of its business model.
Image Source: Zacks Investment Research
ASTS Trading at a Premium
The company is currently valued at a premium compared to its industry on a forward 12-month P/S basis. From a valuation standpoint, AST SpaceMobile appears to be relatively expensive compared to the industry and above its mean. Going by the price/sales ratio, the company shares currently trade at 104.04 forward sales, higher than 4.87 for the industry and the stock’s mean of 18.11.
Image Source: Zacks Investment Research
End Note
The collaboration with leading MNOs is seen as a pathway to unlocking the potential of space-based cellular broadband, promising seamless, reliable service across the continental United States. The successful launch of the Bluebird satellites will likely transform network connectivity and help bridge the digital divide, significantly expanding its global presence and enhancing AST SpaceMobile’s capabilities in providing ubiquitous connectivity.
However, with a Zacks Rank #3 (Hold), AST SpaceMobile appears to be treading in the middle of the road, and new investors could be better off if they trade with caution. The downtrend in estimate revisions further portrays skepticism about the company’s business model. It is also trading at premium valuation metrics and investors could wait for a better entry point to cash in on its long-term fundamentals. Consequently, it might not be a prudent investment decision to bet on the stock at the moment. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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ASTS Skyrockets 800% in Past Six Months: Should You Ride the Wave?
AST SpaceMobile, Inc. (ASTS - Free Report) has gained a stellar 800% over the past six months compared with the industry’s growth of 5.8%. It has also outperformed its peers like Aviat Networks, Inc. (AVNW - Free Report) and Comtech Telecommunications Corp. (CMTL - Free Report) over this period.
This Midland, TX-based broadband service provider is reportedly developing the first and only global cellular broadband network in space based on its extensive IP and patent portfolio. With a diverse portfolio of more than 3,400 patent and patent-pending claims worldwide for the direct-to-cell satellite ecosystem from space to Earth, AST SpaceMobile’s remarkable transformation in recent months offers a competitive edge across the broader technology market.
One-Year Price Performance
Image Source: Zacks Investment Research
What Lies Behind ASTS' Meteoric Rise?
In mid-May this year, AT&T Inc. (T - Free Report) and AST SpaceMobile entered into a definitive commercial agreement, extending until 2030, to provide a space-based broadband network directly to everyday cell phones. The integration of space-based direct-to-mobile technology is designed to complement and integrate with AT&T’s existing mobile network. This approach aims to provide customers with connectivity in locations previously deemed unreachable, enhancing AT&T’s industry leadership in utilizing emerging satellite technologies.
Later in the month, Verizon Communications Inc. (VZ - Free Report) became the second major mobile network operator (MNO) partner in the United States to collaborate with AST SpaceMobile by making a $100 million commitment for satellite direct-to-cellular service for its customers. The two back-to-back deals sent the ASTS stock price soaring. It further enhanced cellular coverage in the United States, essentially eliminating dead zones and empowering remote areas of the country with space-based connectivity.
Bluebird Satellites Propelling ASTS to Greater Heights
AST SpaceMobile recently announced the successful completion of its first five commercial satellites, marking a key advancement in developing a space-based mobile network infrastructure. Dubbed Bluebird, these satellites are equipped with the largest-ever commercial communications arrays spanning 693 square feet. They will be deployed in low Earth orbit to potentially offer non-continuous service across the United States using more than 5,600 cells within the premium low-band spectrum.
This achievement follows the success of AST SpaceMobile's in-orbit BlueWalker 3 satellite. It marks significant progress in the company's mission to create a space-based cellular broadband network that can directly link with mobile devices, eliminating the need for ground-based infrastructure. By expanding its connectivity to remote areas, the company aims to ensure that more people have access to vital communication services.
The Bluebird satellites, having passed stringent testing to meet the high standards of space operations, have been successfully launched today into low-earth orbit from Cape Canaveral, Florida, aboard a SpaceX rocket.
Estimate Revision Trend of ASTS
The Zacks Consensus Estimate for AST SpaceMobile for 2024 and 2025 has widened 151.2% and 165.4%, respectively, to a loss of $1.03 and a loss of 51 cents per share over the past year. The negative estimate revision depicts pessimism about the stock’s growth potential as investors remain skeptical about the success of its business model.
Image Source: Zacks Investment Research
ASTS Trading at a Premium
The company is currently valued at a premium compared to its industry on a forward 12-month P/S basis. From a valuation standpoint, AST SpaceMobile appears to be relatively expensive compared to the industry and above its mean. Going by the price/sales ratio, the company shares currently trade at 104.04 forward sales, higher than 4.87 for the industry and the stock’s mean of 18.11.
Image Source: Zacks Investment Research
End Note
The collaboration with leading MNOs is seen as a pathway to unlocking the potential of space-based cellular broadband, promising seamless, reliable service across the continental United States. The successful launch of the Bluebird satellites will likely transform network connectivity and help bridge the digital divide, significantly expanding its global presence and enhancing AST SpaceMobile’s capabilities in providing ubiquitous connectivity.
However, with a Zacks Rank #3 (Hold), AST SpaceMobile appears to be treading in the middle of the road, and new investors could be better off if they trade with caution. The downtrend in estimate revisions further portrays skepticism about the company’s business model. It is also trading at premium valuation metrics and investors could wait for a better entry point to cash in on its long-term fundamentals. Consequently, it might not be a prudent investment decision to bet on the stock at the moment. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.