The bank war - pay attention to what happens when analysts disagree with each other - the drama behind ASTS's zig-zag
The market is in a classic bipolar episode, and this time the victim is ASTS stock.
If you were looking for proof that even the most buttoned-up analysts on Wall Street don't really know if this is a technological revolution or an expensive experiment that will end in a crash landing, you got it in the last 48 hours.
What happened here is a real boxing match between two financial institutions that simply don't agree on anything.
Yesterday, Scotiabank analysts arrived and decided to pour a bucket of ice water on the party.
They downgraded the stock, and the market reacted immediately:
A free fall of 12%.
Investors already started looking for parachutes, convinced that the dream of satellite internet directly to mobile phones was crashing into the ocean.
But don't blink, because today Bank of America arrived with an adrenaline shot.
The analysts there probably just like to live on the edge, and upgraded the stock.
The big picture: white noise of suits and ties
What do we really understand from all this circus?
That the market simply reacts to the 'leaders' who shout the loudest at that moment.
This is a war over the narrative:
On one hand, the skeptics who look at the cash burn and the insane technological risks.
On the other hand, the optimists who see potential in global communication.
When one bank downgrades and another upgrades in less than two days, it's not cold financial analysis - it's a statement of intent.
This stock behaves like a child at an amusement park going up and down on a roller coaster, while the analysts are the ones flipping the switches and trying to decide where the car goes.
In the current situation, the price is not a function of earnings or revenue, but a function of 'who speaks last in the newsroom'?