AST SpaceMobile (NASDAQ:ASTS) Stock Price Up 14.1% - Still a Buy?

Key Points

• AST SpaceMobile shares rose 14.1% to $36.89 on trading volume 52% above average, amid broader strength in space stocks and optimism around potential government and defense demand.
• AST and Rakuten Group agreed to create Rakuten AST to develop a direct-to-smartphone satellite network in Japan; the venture could benefit from roughly $1 billion in expected government support.
• Quarterly results missed expectations, with revenue of $42.32 million versus a $45.73 million consensus and a per-share loss of $0.44 versus $0.42 expected. Analyst views are mixed, and the article also notes unproven securities-fraud allegations and concerns about launch costs.

AST SpaceMobile, Inc. (NASDAQ:ASTS - Get Free Report)'s share price rose 14.1% during trading on Monday. The stock traded as high as $38.20 and last traded at $36.89. Approximately 25,560,611 shares changed hands during trading, an increase of 52% from the average session volume of 16,806,857 shares. The stock had previously closed at $32.33.

AST SpaceMobile News Roundup

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

• Positive Sentiment: AST SpaceMobile and Rakuten Group agreed to form Rakuten AST to build a direct-to-smartphone satellite network in Japan. Reports cite roughly $1 billion in expected government support, giving AST a potential government-backed customer and a foothold in a market where major carriers use Starlink. Rakuten and AST SpaceMobile Establish Rakuten AST Joint Venture
• Positive Sentiment: Investors are also weighing possible government and defense demand, including a reported potential Space Force opportunity. Analysts see government demand growing, though this remains an anticipated catalyst rather than a confirmed award. AST SpaceMobile and a potential Space Force opportunity
• Neutral Sentiment: ASTS is reporting results after the market close. Wall Street expects quarterly revenue of about $46 million, more than triple the year-ago figure, while Cantor is cautiously optimistic about demand but flags launch costs. Results and management’s outlook could drive the next move. Cantor’s outlook ahead of AST SpaceMobile earnings
• Neutral Sentiment: Market-wide strength in space stocks and the broader market, along with possible short covering ahead of earnings, may also be supporting shares, independent of new company fundamentals. What is driving the pre-earnings rally
• Negative Sentiment: Several law firms publicized a securities class action alleging AST overstated its capital position and competitive lead; the allegations are unproven. Separately, UBS lowered its price target and Scotiabank downgraded the shares to Sell, citing concerns that add to investor risk. Class action notice and analyst reassessments

Analyst Upgrades and Downgrades

ASTS has been the topic of a number of research analyst reports. Scotiabank upgraded shares of AST SpaceMobile from a "sector perform" rating to a "sector outperform" rating and raised their target price for the company from $50.80 to $55.70 in a research note on Friday, October 23rd. Weiss Ratings restated a "sell (d-)" rating on shares of AST SpaceMobile in a research report on Monday, September 21st. UBS Group began coverage on shares of AST SpaceMobile in a research report on Wednesday, September 2nd. They issued a "buy" rating for the company. Royal Bank Of Canada lowered AST SpaceMobile to a "sector perform" rating in a research note on Friday, October 2nd. Finally, B. Riley Financial cut shares of AST SpaceMobile from a "buy" rating to a "neutral" rating and cut their target price for the company from $85.00 to $65.00 in a research note 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 given a Sell rating to the company. According to data from MarketBeat, the company has an average rating of "Hold" and an average target price of $80.67.

AST SpaceMobile Stock Up 14.1%

The firm's 50-day simple moving average is $52.17 and its 200 day simple moving average is $76.01. The company has a debt-to-equity ratio of 1.24, a quick ratio of 12.90 and a current ratio of 13.05. The company has a market cap of $14.36 billion, a P/E ratio of -17.24 and a beta of 2.88.

AST SpaceMobile (NASDAQ:ASTS - Get Free Report) last issued its earnings results on Monday, November 9th. The company reported ($0.44) earnings per share (EPS) for the quarter, missing analysts' consensus estimates of ($0.42) by ($0.02). AST SpaceMobile had a negative return on equity of 22.88% and a negative net margin of 536.66%. The company had revenue of $42.32 million for the quarter, compared to the consensus estimate of $45.73 million. On average, research analysts forecast that AST SpaceMobile, Inc. will post -1.91 earnings per share for the current fiscal year.

Insider Buying and Selling

In other AST SpaceMobile news, COO Shanti Gupta sold 12,000 shares of AST SpaceMobile stock in a transaction dated Wednesday, September 16th. The stock was sold at an average price of $58.89, for a total transaction of $706,680.00. Following the transaction, the chief operating officer directly owned 462,980 shares in the company, valued at approximately $27,264,892.20. The trade was a 2.53% decrease in their ownership of the stock. The transaction was disclosed in a legal filing with the SEC, which is accessible through this link. Also, CTO Huiwen Yao sold 40,000 shares of AST SpaceMobile stock in a transaction dated 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 owned 34,750 shares in the company, valued at $2,047,817.50. This trade represents a 53.51% decrease in their position. The disclosure for this sale is available in the SEC filing. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. 20.89% of the stock is currently owned by company insiders.

Hedge Funds Weigh In On AST SpaceMobile

A number of hedge funds and other institutional investors have recently bought and sold shares of ASTS. Compass Financial Management LLC bought a new position in shares of AST SpaceMobile during the second quarter valued at $26,000. Grove Bank & Trust acquired a new position in shares of AST SpaceMobile in the 2nd quarter valued at about $27,000. Continuum Advisory LLC acquired a new position in AST SpaceMobile in the second quarter valued at approximately $28,000. Cornerstone Planning Group LLC boosted its stake in AST SpaceMobile by 16,350.0% during the first quarter. Cornerstone Planning Group LLC now owns 329 shares of the company's stock worth $27,000 after acquiring an additional 327 shares in the last quarter. Finally, Community Financial Services Group LLC bought a new position in shares of AST SpaceMobile during the 2nd quarter worth about $47,000. Institutional investors own 60.95% of the company's stock.

About AST SpaceMobile

AST SpaceMobile, Inc develops a space-based cellular broadband network designed to connect directly with standard mobile phones, without requiring users to purchase specialized satellite devices. Its planned services include voice calls, text messaging and mobile broadband, delivered through partnerships with mobile network operators and integrated with their existing networks.

The company is developing and deploying its BlueBird satellite system to provide coverage in areas where terrestrial cellular networks are unavailable or limited.

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