Has the satellite lost altitude? 🪐
Why is everyone fleeing $ASTS today? 🔽
Investment bank Scotiabank just sent a 'disconnection alert' to the communications stock. 🚫
The bank's analysts decided to bring the stock back to earth, and they did it with an axe. ⛏
The market, which detests sudden disillusionment, reacted with a 7% drop because it turns out there's gravity even in the vacuum of space. ‼️
The numbers that leave nothing to the imagination 📊
Scotiabank's downgrade isn't just a small 'tsk-tsk'. 😇
They moved the stock from an 'in-line' rating to 'underperform'. But the real blow is the price target: $45.60. 🩸
When a stock trades above $90 and the bank says it's worth half, it's not just raising an eyebrow – it's telling you the party's over and someone forgot to turn off the lights. 🔥
🚨 We are talking about a gap of more than 50% from the current price. 🚨
The story behind the collapse: a lot of hardware, zero customers 👻
ASTS's problem isn't the vision, but the dry and annoying reality. Scotiabank's analysts pointed to three painful issues: ⛈
1️⃣A club without dancers:
As of now, the company has zero retail revenue. 🅾️
There isn't a single end-user, a human with a phone, paying them a shekel. 🤔
It's like starting an airline without planes or passengers and expecting the stock to fly to Mars. ❌
2️⃣A timeline that feels like an eternity: 🔮
To provide normal and continuous service, the company needs a constellation of about 50 satellites. ‼️
Currently?
We are far from there. ⛔️
Scotiabank estimates this goal will only be achieved towards the end of 2026 or during 2027. 🗓
- In the stock market, two to three years is an eternity, and investors don't have the patience to wait while the company burns cash at the rate of a space shuttle. 🔎
3️⃣Expectation gap: There's a huge gap between the 'hype' on Twitter and the insane logistical complexity of launching dozens of satellites. The market is starting to realize that building a cellular network in space is a bit harder than installing a router at home.
The market is currently experiencing a mild anxiety attack regarding this stock. 👀
When the gap between the market price and the economic value seen by analysts is so abysmal, the stock becomes particularly dangerous. 🎢
Currently, space looks colder and emptier than ever. 🌑
Additionally, it's worth remembering that there are no free lunches on Wall Street, and sometimes analyst reports are a weapon. ⚔️
There are voices in the market claiming this is a 'targeted elimination' or an artificial attempt to lower the price to allow the big whales to enter. 🛒
Here are the reasons why analysts might be wrong? 💡
1️⃣Ignoring the technological achievement: 🏎 The company has already proven the technology works. The first five satellites are already in space, and the ability to connect a regular smartphone directly to a satellite is not a 'dream' – it's an existing reality. ✔️
Analysts focus on bureaucracy and launch rates, but ignore the fact that AST SpaceMobile has built a technological moat. 👑
2️⃣Dinosaurs don't price growth: 🦖 Traditional banks like Scotiabank will always struggle to price companies trying to change the world order. 🌎
3️⃣Scent of interests: 🤔 We have often seen banks downgrade a rating just before they (or their preferred clients) load up on stock. 🪣
When the gap between the market price and the price target is so violent, it raises questions ❓
The market is currently in a battle between the skepticism of banks and the fervent belief of technology investors. 🥊
On one hand, a company without retail revenue is an insane risk, especially when the timeline stretches to 2027. ⚠️
On the other hand, if the company succeeds in completing its satellite deployment, will a price of $45 perhaps look like a sad joke from the past? 👀
We continue to follow – we will update 🔎