AST SpaceMobile: Reaching for the Stars (and a Valuation)

by

So, AST SpaceMobile (ASTS +0.47%) is currently trading at a $39 billion market cap, despite having generated a mere $54.3 million in revenue over the last twelve months. That’s a price-to-sales ratio that makes avocado toast look like a fiscally responsible investment. It’s the kind of number that makes you wonder if someone accidentally added a zero… or three. Let’s unpack this, because my therapist is starting to ask questions about my stock research habits.

Loading widget...

Why the Premium? (Besides Optimism)

The pitch is this: AST is building a satellite constellation to beam cellular service directly to your phone. Like, no towers needed. It’s ambitious, bordering on “let’s just solve world hunger while we’re at it.” Their partners read like a who’s who of mobile carriers – AT&T, Verizon, Vodafone, and now TELUS. Collectively, they serve billions of subscribers, which is a lot of potential bill-paying customers. If this actually works, we’re talking about recurring revenue in the tens of billions. They’ve also snagged a defense contract, because apparently, even the military wants to be able to Instagram from anywhere. It’s a bold strategy, Cotton, let’s see if it pays off.

Is This Worth the Existential Dread?

Here’s where things get…interesting. They have a handful of satellites orbiting Earth, and plan to launch dozens more. That’s good! But “plans” and “actual launches” are two very different things, as anyone who’s tried to assemble IKEA furniture can attest. There’s a lot of execution risk here. We’re talking about launching complex technology into the unforgiving void of space. What could possibly go wrong?

At this valuation, you’re basically paying for a future that is, shall we say, aspirational. It’s like buying a timeshare in a metaverse nobody’s using. Still, if you’re the kind of investor who enjoys living on the edge – and has a very high risk tolerance (and maybe a good therapist) – there’s a sliver of opportunity here. Just remember, space is hard. And so is explaining this stock pick to your financial advisor.

Read More

2026-03-10 03:32