In this DD i will try to explain to you regards how good of an investment ASTS is currently, while trying to be at least somewhat impartial. Here we go.
- So ASTS is currently doing what no other company did before, and that is providing mobile data through satellites using frequencies that current smartphones support without any modifications. Today I will go through some strengths and weaknesses of this company:
- ASTS is very far ahead of SpaceX in regards to the Direct-2-Cell market as ASTS already has 13 satellites in orbit and 3 more are due to be launched soon. They have also announced the start of intermittent service in Developed markets by early 2027. Some of these markets include US, Japan, United Kingdom, Canada and Saudi Arabia.
- They have VERY strong partners, some of them including AT&T, Verizon, Vodafone, Google, Bell, Deutsche Telekom, Telefonica and Orange. This, along the recent dispute between SpaceX and T-Mobile(an affiliate company of Deutsche Telekom) shows that Mobile Network Operatos are serious about preventing SpaceX from becoming a real threat to their market share, and they will use ASTS to prevent this from happening.
- SpaceX is facing scrutiny from the European Union as they have stopped Starlink Service in Ukraine. This will cause the EU to and other countries to adopt SpaceX competitors in order to prevent the US from shutting down their infrastructure, one may argue that ASTS is also american, and to this i say that Europoors are chuds who will still choose ASTS since they're the best option possible.
- They also have military capabilities, since current smartphones do not need any modifications, soldiers would be able to carry normal modern smartphones, while also being cheaper than traditional satellite brick phones making them very attractive for governments to work with them.
- They own over 3400 patents and patent-pending claims.
- Their current constellation is planned for 248 satellites. But they only need 96 for full global service and should have 48 up by the EOY.
- Future dilution is improbable as they have plenty of cash on hand ($2.28B).
- They also claim to have a $1.3B backlog, indicating strong demand.
- They recently hired 500 people in order to speed up production
- Deutsche Bank upgraded them to a buy with a $108 PT
I said I am trying to be impartial, so here are some of the weaknesses of this stock too:
- One of the very big caveats about this company is that they are dependent on launch providers, one of them being SpaceX, although with a legally binding contract elon is pretty close to the trump admin, allowing Elon to flat out refuse launching rockets for ASTS, although they do have Blue Origin as another launch provider they launch rockets a lot less often than SpaceX.
- They do not really own the frequency spectrum, the Mobile Network Operators do.
- Starlink also have a larger fleet size, while their mobile data is currently ass, their Direct-2-Cell capabilities improve as more V3 satellites go up. SpaceX also plans on building ground coverage too, allowing them to offer service in populated areas too.
- They also have a record of not being on schedule with their launches, as initially the 45 satellites that were supposed to be up by the end of this year have been delayed to Early 2027.
- Piper downgraded them from Overweight to Neutral $98 -> $54 PT
- B. Riley downgraded them from Buy to Neutral with a $65 PT
Overall, this company is indeed high risk, but with a very high upside potential so this is why i have my entire university fund on it. I will either show you all my fully paid off degree or end up a degenerate bum.
positions: 402 shares @ 57.06