AST SpaceMobile, Inc. (ASTS): A Bull Case Theory

We came across a bullish thesis on AST SpaceMobile, Inc. (ASTS) on Substack by Steve Wagner. In this article, we will summarize the bulls’ thesis on ASTS. AST SpaceMobile, Inc. (ASTS)’s share was trading at $26.24 as of May 15^th.

AST SpaceMobile (ASTS) is transitioning from a developmental phase to a potential commercial breakthrough, following a solid first quarter that emphasized progress over profit. Despite minimal revenue of $0.6M—mainly from early-stage gateway sales and government milestones—the lack of service income is expected, as commercial deployment remains targeted for late 2025. Operating losses widened to $63.6M due to ramped-up R&D and satellite production, but ASTS’s strengthened balance sheet, boasting $874M in cash after a $460M convertible note and $55M share offering, provides a clear funding runway through at least 2025.

The dilution risk is real but muted near-term given the $27/share conversion price. The company projects $50M–$75M in 2025 revenue, tied to commercial service activation. A promising $13.6M in Q1 ground infrastructure orders from telecom partners is expected to recur quarterly, signaling network readiness. ASTS also benefits from $63M in government contracts, validating both commercial and defense potential. With six satellites already in orbit and a goal of 60 by end-2026, the company plans to begin monthly launches by July 2025, supported by vertically integrated manufacturing capable of producing six satellites per month. Most critically, ASTS recently completed a historic milestone: the world’s first successful two-way voice and video calls over 4G LTE via satellite to unmodified smartphones, in partnership with telecom giants like AT&T, Vodafone, and Rakuten. With 40+ mobile network operator agreements covering 2.4B subscribers, ASTS is gaining momentum. The coming quarters are critical; if services launch and gain user traction, ASTS could transform into a commercially viable disruptor in satellite communications.

AST SpaceMobile, Inc. (ASTS) is not on our list of the 30 Most Popular Stocks Among Hedge Funds. As per our database, 22 hedge fund portfolios held ASTS at the end of the fourth quarter which was 18 in the previous quarter. While we acknowledge the risk and potential of ASTS as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than ASTS but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.

READ NEXT: 8 Best Wide Moat Stocks to Buy Now and 30 Most Important AI Stocks According to BlackRock.

Disclosure: None. This article was originally published at Insider Monkey.