AST SpaceMobile (ASTS) stock skyrocketed by about 51% following the announcement of its five commercial satellites set to launch in early September. The satellites are now in the final preparation stage at Cape Canaveral, Florida. This news was announced with the company’s Q2 earnings release.
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Before diving into the details of AST SpaceMobile’s upcoming launch, let’s review its Q2 financial results.
ASTS: Q2 Highlights
The company reported a net loss of $0.51 per share, higher than the consensus estimate of a loss of $0.22 per share. Also, the reported figure compared unfavorably with a loss of $0.24 in the prior-year quarter. Furthermore, the company’s revenue of $0.9 million largely missed the analysts’ expectations of $7.58 million.
Nevertheless, AST SpaceMobile has a strong balance sheet, with nearly $288 million in cash and cash equivalents at Q2-end. This reflects an increase of 36% from the previous quarter.
ASTS Targets U.S. Coverage with New Satellites
During the company’s earnings call, CEO Abel Avellan stated that ASTS is now in full-scale production and commercialization of its space-based cellular broadband network.
With the upcoming launch, the company aims to nearly cover the entire continental United States with its direct satellite-to-cell phone service. This milestone brings ASTS closer to its goal, which is also being pursued by competitors such as Elon Musk’s SpaceX.
Interestingly, the company’s commercial satellites will be the largest communications array ever deployed into low-Earth orbit. Last month, ASTS said it had received approval from the U.S. Federal Communications Commission (FCC).
The company has partnered with major telecom players like AT&T (T) and Verizon (VZ) to provide the wireless service. These strategic alliances, along with the potential for capturing a significant share of the telecommunications market, likely fueled investor excitement.
Is ASTS a Good Stock to Buy?
On TipRanks, AST SpaceMobile has a Strong Buy consensus rating based on four unanimous Buy ratings. The analysts’ average price target on ASTS stock of $23.03 implies a downside potential of 26.56%. It should be noted that analysts have not yet updated their price targets following the recent surge in the stock price.
