AST SpaceMobile’s stock is experiencing another movement on Monday, showing a rise of approximately 2.3% by 12:20 p.m. However, the stock’s volatility means its direction could change quickly.
Scotiabank analyst Andres Graham is responsible for today’s fluctuations, having increased his price target for AST shares from $28 to an exact figure of $45.90. This precise valuation is intriguing given the difficulty in assessing a stock that lacks profitability.
Why Scotiabank is Optimistic About AST SpaceMobile
Graham insists that his revised price target is not influenced by any “short-term trading opportunity” with AST. Instead, he takes a long-term perspective, highlighting AST’s advanced satellite technology, which he believes could potentially transform it into “the world’s largest wireless company by subscribers.”
This prediction may sound reminiscent of AST’s initial public offering hype, where the company ambitiously aimed at capturing “five billion mobile subscribers” within a “$1 trillion global mobile wireless services market.”
Graham emphasizes that AST’s technology is remarkably advanced, with an estimated peak data rate reaching up to 120 megabits per second per satellite, surpassing even SpaceX’s Starlink.
Is AST Stock Worth Investing In?
According to Graham, AST’s superior data transmission speeds (a claim SpaceX might contest) and enhanced beam precision could compel SpaceX to redesign its satellites entirely to compete. Such an undertaking would be challenging, considering SpaceX already has over 6,200 Starlink satellites orbiting Earth.
What likely excites investors more today is Graham’s speculation that SpaceX might consider acquiring AST SpaceMobile. With AST’s market cap at $9 billion and SpaceX valued well over $200 billion, such an acquisition is feasible. SpaceX certainly has the financial capacity for this purchase.
However, betting on this outcome might be risky. Starlink is already profitable, unlike AST. Investing in a potential Starlink IPO seems more appealing than buying into the currently unprofitable AST stock.
Points to Ponder Before Investing in AST SpaceMobile
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For instance, had you invested $1,000 in Nvidia when it was recommended on April 15, 2005, your investment would now be worth $792,725!
