Amid High Profile Deals, Is AST SpaceMobile's Stock a Buy in 2026?
Key Points
AST plans to expand its LEO satellite constellation over the next few years.
But its near-term gains could be limited in this wobbly market.
AST SpaceMobile (NASDAQ: ASTS), a producer of low-earth orbit (LEO) satellites, saw its stock soar by more than 3,000% over the past two years. Let's see why it skyrocketed and whether it's still worth chasing this year in this unpredictable market.
Why did AST SpaceMobile's stock blast off?
AST's LEO satellites can beam 2G, 4G, and 5G cellular signals directly to mobile devices. It helps telecom leaders -- including AT&T (NYSE: T), Verizon (NYSE: VZ), and Vodafone (NASDAQ: VOD) -- extend their wireless networks to rural areas that terrestrial cellular towers can't reach. The U.S. Missile Defense Agency also recently chose AST as a prime contractor for its Scalable Homeland Innovative Enterprise Layered Defense (SHIELD) program.
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When AST went public by merging with a special purpose acquisition company (SPAC) five years ago, it was considered a speculative space stock. But in 2024, it finally launched its first five Block 1 BlueBird (BB1) commercial satellites. Last December, it launched its first four Block 2 BlueBird (BB2) satellites, which are 3.5 times larger but process roughly ten times more data.
AST aims to have 45-60 satellites in orbit by the end of 2026 and expand that constellation to more than 240 satellites over the long term. However, the Federal Communications Commission (FCC) hasn't approved that massive expansion yet.
Can AST SpaceMobile maintain that momentum?
From 2024 to 2025, AST's revenue surged from $4 million to $71 million as it launched its BB1 and BB2 satellites for its telecom customers. But it's still unprofitable, and its expenses are soaring as it scales its business and launches more satellites.
From 2025 to 2028, analysts expect its revenue to surge to $1.92 billion. They also expect its adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) to turn positive in 2027 and nearly quadruple to $1.30 billion in 2028 as economies of scale kick in.
That bullish outlook hinges on the FCC's approval of its expanded satellite constellation, its SHIELD contract, and new telecom and government contracts. But with a market cap of $28.1 billion, AST already trades at 15 times its projected 2028 sales.
That valuation might seem reasonable relative to its long-term growth potential, but a single delay could drive away the bulls and cut its stock in half. As a result, AST could remain out of favor this year as the Iran War and other macro headwinds drive investors toward safer stocks. So while AST is still worth nibbling on as a long-term space play, I wouldn't go all-in just yet.
Leo Sun has positions in Verizon Communications. The Motley Fool has positions in and recommends AST SpaceMobile. The Motley Fool recommends Verizon Communications and Vodafone Group Public. The Motley Fool has a disclosure policy.