AST SpaceMobile (NASDAQ:ASTS) Shares Down 11.3% - Here's What Happened

Key Points

• AST SpaceMobile shares fell 11.3% to about $36.33 amid concerns over upcoming earnings, legal pressure, and intensifying competition from SpaceX in direct-to-device satellite connectivity.
• The company reported a recent quarterly loss and revenue below expectations, while analysts are watching next week’s earnings for evidence of improving performance. Its average analyst rating remains “Hold,” despite an average price target of $80.67.
• AST SpaceMobile also announced a successful AT&T network-to-satellite handoff test, supporting its technology outlook, and Vanguard reportedly increased its stake by 22.5%; however, securities-class-action notices remain an additional risk.

AST SpaceMobile, Inc. (NASDAQ:ASTS - Get Free Report)'s share price traded down 11.3% on Monday. The stock traded as low as $36.08 and last traded at $36.33. Approximately 17,600,428 shares traded hands during trading, an increase of 6% from the average session volume of 16,647,711 shares. The stock had previously closed at $40.97.

Key AST SpaceMobile News

Here are the key news stories impacting AST SpaceMobile this week:

• Positive Sentiment: AST SpaceMobile and AT&T, with support from Ericsson and Nokia, completed what they described as an industry-first handoff between a conventional cellular network and AST’s direct-to-device satellite network. The test strengthens the company’s case that phones can transition between terrestrial and satellite coverage without dropping connectivity, supporting its path toward beta services and broader BlueBird satellite coverage. AT&T and AST SpaceMobile: Engineering the Connected World, One Handoff at a Time
• Positive Sentiment: Vanguard Capital Management reportedly increased its ASTS position 22.5% to 15.3 million shares, or approximately a 5.11% stake. The purchase may provide some institutional support, although retail sentiment remains bearish. ASTS Stock Jumps Overnight: Vanguard, Rakuten Unit Boost Holdings
• Neutral Sentiment: AST SpaceMobile is scheduled to report earnings next week. Analysts are focused on whether the company can meet expectations, with previews warning that current indicators do not suggest a likely earnings beat. The company’s prior quarter included a revenue shortfall and a larger-than-expected loss.
• Negative Sentiment: Multiple law firms publicized a securities class action and a November 13 lead-plaintiff deadline. The allegations include claims that AST’s disclosures about sufficient cash preceded approximately $3 billion of convertible-note offerings. These are allegations, not established findings, but the repeated notices add legal and reputational pressure. ASTS Deadline Alert
• Negative Sentiment: Competition is also weighing on the stock after reports that SpaceX is gaining ground in discussions to add satellite connectivity to Boost Mobile plans, intensifying the race for direct-to-device customers in the U.S. SpaceX Climbs on Reported Boost Mobile Talks

Analysts Set New Price Targets

A number of equities analysts have recently commented on the company. Scotiabank raised AST SpaceMobile from a "sector perform" rating to a "sector outperform" rating and boosted their price objective for the stock from $50.80 to $55.70 in a research report on Friday, October 23rd. Berenberg Bank initiated coverage on AST SpaceMobile in a research note on Wednesday, September 2nd. They issued a "buy" rating and a $92.00 price target on the stock. William Blair reiterated a "market perform" rating on shares of AST SpaceMobile in a research note on Monday, October 5th. Weiss Ratings restated a "sell (d-)" rating on shares of AST SpaceMobile in a research note on Monday, September 21st. Finally, Royal Bank Of Canada cut shares of AST SpaceMobile to a "sector perform" rating in a report on Friday, October 2nd. Six equities research analysts have rated the stock with a Buy rating, six have issued a Hold rating and two have assigned a Sell rating to the company's stock. According to MarketBeat, the stock has an average rating of "Hold" and an average price target of $80.67.

AST SpaceMobile Trading Down 11.3%

The firm has a market cap of $14.14 billion, a price-to-earnings ratio of -16.98 and a beta of 2.88. The company has a current ratio of 13.05, a quick ratio of 12.90 and a debt-to-equity ratio of 1.24. The company has a 50 day moving average of $55.02 and a 200 day moving average of $77.74.

AST SpaceMobile (NASDAQ:ASTS - Get Free Report) last issued its quarterly earnings results on Monday, August 10th. The company reported ($0.77) earnings per share for the quarter, missing analysts' consensus estimates of ($0.32) by ($0.45). AST SpaceMobile had a negative net margin of 536.66% and a negative return on equity of 22.88%. The company had revenue of $31.52 million during the quarter, compared to analyst estimates of $34.53 million. During the same period in the prior year, the business earned ($0.41) EPS. As a group, research analysts anticipate that AST SpaceMobile, Inc. will post -1.91 EPS for the current year.

Insider Buying and Selling

In other AST SpaceMobile news, CTO Huiwen Yao sold 40,000 shares of the company's stock in a transaction on Wednesday, September 16th. The shares were sold at an average price of $58.93, for a total value of $2,357,200.00. Following the transaction, the chief technology officer directly owned 34,750 shares in the company, valued at $2,047,817.50. The trade was a 53.51% decrease in their ownership of the stock. The transaction was disclosed in a document filed with the Securities & Exchange Commission, which is available at this hyperlink. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, COO Shanti B. Gupta sold 12,000 shares of AST SpaceMobile stock in a transaction on Wednesday, September 16th. The stock was sold at an average price of $58.89, for a total value of $706,680.00. Following the sale, the chief operating officer directly owned 462,980 shares of the company's stock, valued at $27,264,892.20. This represents a 2.53% decrease in their position. The SEC filing for this sale provides additional information. 20.89% of the stock is currently owned by corporate insiders.

Hedge Funds Weigh In On AST SpaceMobile

A number of hedge funds have recently modified their holdings of the business. Hollencrest Capital Management grew its stake in shares of AST SpaceMobile by 11.7% in the 1st quarter. Hollencrest Capital Management now owns 1,592 shares of the company's stock valued at $132,000 after buying an additional 167 shares during the period. Byrne Asset Management LLC increased its stake in shares of AST SpaceMobile by 17.0% in the third quarter. Byrne Asset Management LLC now owns 1,170 shares of the company's stock worth $67,000 after purchasing an additional 170 shares in the last quarter. TD Waterhouse Canada Inc. lifted its holdings in AST SpaceMobile by 15.5% during the 2nd quarter. TD Waterhouse Canada Inc. now owns 1,404 shares of the company's stock worth $121,000 after purchasing an additional 188 shares in the last quarter. MGO One Seven LLC grew its stake in AST SpaceMobile by 1.9% during the third quarter. MGO One Seven LLC now owns 12,536 shares of the company's stock valued at $738,000 after acquiring an additional 239 shares in the last quarter. Finally, Salvus Wealth Management LLC boosted its stake in AST SpaceMobile by 0.4% during the third quarter. Salvus Wealth Management LLC now owns 70,662 shares of the company's stock valued at $4,159,000 after buying an additional 263 shares during the period. Institutional investors and hedge funds own 60.95% of the company's stock.

AST SpaceMobile Company Profile

AST SpaceMobile, Inc is a space-based communications company developing a global cellular broadband network designed to connect directly with standard, unmodified mobile phones. Its technology is intended to extend wireless coverage beyond traditional terrestrial networks, including in rural, remote and underserved areas.

The company is building and deploying a constellation of large low Earth orbit satellites, known as the BlueBird satellite system. AST SpaceMobile plans to provide voice, messaging, data and broadband services through partnerships with mobile network operators, allowing subscribers to remain connected outside the reach of conventional cellular towers.

Founded in 2017 and headquartered in Midland, Texas, AST SpaceMobile was established by Abel Avellan, who serves as its chairman and chief executive officer.

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