AST SpaceMobile down 52.8% from high as Roth MKM sees 71.1% upside

AST SpaceMobile shares trade at $63.12, sitting 52.8% below their 52-week high of $133.86, yet Roth MKM maintains a Buy rating with a $108.00 price target. This valuation implies 71.1% upside for investors, a stance that contrasts with the stock's recent decline following a failed satellite launch and six consecutive earnings misses.

The recent price action reflects specific operational setbacks. A Blue Origin rocket failed to place the BlueBird 7 satellite in the correct orbit, resulting in a $125.9 million loss on involuntary conversion in the second quarter. This news triggered a 15% drop in shares. The company also reported a first-quarter revenue of $14.73 million, missing the consensus estimate of $36.58 million by 59.72%. Second-quarter revenue reached $31.52 million, while GAAP EPS of -$0.77 missed the -$0.29 estimate, marking the sixth straight quarter of missed earnings expectations.

Despite these financial shortfalls, AST SpaceMobile continues to build its space-based cellular broadband network, which connects BlueBird satellites directly to smartphones. The company reports over 60 mobile network operator partners covering more than 3 billion subscribers, alongside growing U.S. government contracts. Roth MKM argues that the BlueBird architecture provides a multi-year lead over Starlink and that deals with tier-1 carriers allow access to billions of subscribers without the need for retail customer acquisition.

Management projects a backlog of roughly $1.3 billion and 2026 revenue guidance weighted toward the fourth quarter. The company aims to have about 45 satellites in orbit by early 2027, at which point it expects commercial service to begin. Management targets close to $1 billion in revenue during the first full year of service.

Financial resources remain ample to support near-term operations. Pro forma cash exceeds $3.7 billion following a $1.15 billion convertible offering at a 1.625% rate. Three additional government contracts provide more than $100 million in immediate funding, while the Japanese J-LEO initiative represents a potential value of up to approximately $1 billion, subject to regulatory clearance.

The stock's performance has diverged from its peers, which have seen gains driven by acquisition interest. Iridium Communications is up 185.7% year to date after Rocket Lab agreed to buy it for $8 billion, while Globalstar is up 37.01% year to date following Amazon’s $90 per share offer. AST SpaceMobile remains independent, meaning its price depends entirely on its own execution rather than deal premiums.

The consensus price target from 14 analysts stands at $77.94, placing the stock 23.5% below that level. Deutsche Bank recently lowered its target to $106.00 from above $130. The optimistic scenario relies on launches resuming on schedule and the constellation reaching its target count by early 2027. Conversely, the bear case gains weight if another launch fails or if revenue slips into 2027.