TLDR
- ASTS fell 3.6% on Wednesday, closing at $66.31 after trading as low as $64.59
- The drop was driven by plans to raise up to $1 billion through convertible senior notes due 2034
- Despite the dip, operational news was positive: BlueBird 11 arrived at Cape Canaveral ahead of an August launch
- Bell Canada completed its first direct-to-device satellite ground station in Québec, and ASTS secured regulatory approval in New Zealand
- Analysts hold an average “Reduce” rating with a $85.09 price target; the company missed Q1 earnings by $0.43 per share
AST SpaceMobile (ASTS) dropped 3.6% on Wednesday, closing at $66.31 after dipping as low as $64.59 during the session. The previous close was $68.82.
Trading volume came in at around 12.8 million, well below the average daily volume of 18.3 million.
The main driver behind Wednesday’s move was the company’s announcement that it plans to raise up to $1 billion through convertible senior notes due 2034. Markets reacted negatively, as investors flagged potential dilution risk for existing holders.
Convertible note offerings of this size often signal a company needs additional cash to fund operations. For a company still burning through cash at pace, that concern is hard to ignore.
Operational Progress Continues
Despite the stock pressure, there was no shortage of positive operational updates this week.
BlueBird 11 has arrived at Cape Canaveral, with BlueBirds 12 and 13 scheduled to follow ahead of a planned August launch. That keeps ASTS on track with its satellite deployment timeline.
Bell Canada completed construction of its first sovereign direct-to-device satellite ground station in Québec. The station will connect with AST SpaceMobile’s growing satellite constellation.
ASTS also secured new regulatory authorization in New Zealand for a gateway link, extending its international footprint. Meanwhile, the city of Midland is weighing a $150 million expansion tied to AST’s Texas manufacturing presence.
Financials Still a Concern
The operational news is encouraging, but the numbers tell a different story.
In its most recent quarterly report, ASTS posted a loss of $0.66 per share, missing the consensus estimate of $0.23 by $0.43. Revenue came in at $14.73 million, well short of analyst expectations of $39.01 million.
Analysts expect a full-year loss of $1.47 per share. The company carries a market cap of $25.74 billion, a PE ratio of -37.25, and a beta of 2.69.
On the analyst front, ratings remain cautious. MarketBeat shows an average rating of “Reduce” and an average price target of $85.09. Deutsche Bank recently downgraded from “Buy” to “Hold” and cut its target from $117 to $106. Barclays rates it “Underweight” with a $65 target.
Insiders have been selling. Over the last 90 days, insiders offloaded around 105,809 units of stock valued at roughly $9.7 million. CFO Andrew Martin Johnson alone sold 45,809 units in June at an average price of $93.81.
On the institutional side, Vanguard, Morgan Stanley, and State Street all increased their positions in the fourth quarter. Hedge funds and institutional investors now hold around 60.95% of the stock.
ASTS is down approximately 5.25% year to date. Its 50-day moving average sits at $87.40 and its 200-day at $89.53, both well above the current price.
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