A rendering of an AST SpaceMobile satellite. <\/p>\n
(Bloomberg) — AST SpaceMobile Inc. shares have more than tripled this year as the race for space-based cell phone connectivity heats up. With Elon Musk\u2019s SpaceX division, Starlink, rushing to overtake it, AST is positioned for \u201cpainful corrections,\u201d according to a Scotiabank analyst.<\/p>\n
\u201cIn the midst of an impressive bull market, extreme volatility in recent days has led to what we see as a valuation bubble,\u201d analyst Andres Coello wrote in a note Tuesday downgrading the stock to sector underperform from sector perform. After a key satellite launch setback, he fears further delays may encourage some carriers to explore ditching AST SpaceMobile and moving to Starlink.<\/p>\n
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More than 2 billion people across the globe lack access to the internet via a high-speed network, that has Starlink and AST SpaceMobile vying to build networks that connect cell phones directly to broadband via satellite. Such connectivity is also critical during disasters and in conflict zones.<\/p>\n
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Based in Midland, Texas, AST SpaceMobile\u2019s place as a key player in direct-to-device satellite connectivity has won over investors. The stock has surged\u00a0\u00a0this year. In the last month, the stock has jumped about 83%, with its market capitalization vaulting to almost $27 billion.<\/p>\n
The biggest risks, according to Coello, are that the Block 2 Bluebird satellite \u2014 also known as FM1 \u2014 takes longer than expected or that a launch mission from India fails. If that were to happen SpaceX\u2019s Starlink would stand to benefit.<\/p>\n
AST SpaceMobile shares advanced\u00a0\u00a0to close at a fresh record in New York, erasing an earlier drop in the process and extending a winning streak triggered by the completion of the first successful satellite call over a Canadian wireless network with Bell.<\/p>\n
In a recent update, SpaceX said the next-generation of Starlink direct-to-cell satellites would use a wider range of frequencies that would support a capacity increase of more than 100 times that of current satellites, which will enable full 5G cellular connectivity in most environments. Additionally, the Elon Musk-backed company agreed to acquire wireless spectrum from EchoStar Corp. for $17 billion last month.<\/p>\n
\u201cOur view is that the more time it takes for ASTS to bring a service to the market, the harder it will be to overcome Starlink\u2019s improvements,\u201d said Coello.<\/p>\n
He also reflected that speculation about a possible takeover by Amazon.com Inc. appears overblown. While it makes sense for Amazon\u2019s Project Kuiper \u2014 a low Earth orbit satellite broadband network \u2014 to look for wireless synergies with AST, Coello noted that Amazon\u2019s \u201cplate looks full\u201d with $13 billion to $16 billion in planned fixed capital expenditure investments.<\/p>\n
\u201cWe think a partnership would be mostly on the commercial front, perhaps with a small equity component,\u201d Coello said.<\/p>\n
The stock currently has six buy-equivalent recommendations, four holds and one sell, according to analysts tracked by Bloomberg. Coello\u2019s price target of $42.90 implies more than 40% downside to Tuesday\u2019s close.<\/p>\n
(Updates shares throughout.)<\/p>\n
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\u00a92025 Bloomberg L.P.<\/p>\n","protected":false},"excerpt":{"rendered":"A rendering of an AST SpaceMobile satellite. (Bloomberg) — AST SpaceMobile Inc. shares have more than tripled this…\n","protected":false},"author":2,"featured_media":60023,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[23],"tags":[44500,4684,1877,85,46,44499,44501,141,145,4688,4689],"class_list":{"0":"post-60022","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-space","8":"tag-andres-coello","9":"tag-ast-spacemobile","10":"tag-bloomberg","11":"tag-il","12":"tag-israel","13":"tag-satellite-connectivity","14":"tag-satellite-launch","15":"tag-science","16":"tag-space","17":"tag-spacex","18":"tag-starlink"},"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/posts\/60022","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/comments?post=60022"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/posts\/60022\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/media\/60023"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/media?parent=60022"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/categories?post=60022"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/tags?post=60022"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}