ASTS Stock Dips on Failed BlueBird Deployment But BofA Says Business Thesis Intact

• AST said on Sunday that its BlueBird 7 satellite, one of the many planned for its space-based cellular broadband network, was placed into a lower than planned orbit.
• Clear Street, meanwhile, lowered the firm's price target on AST SpaceMobile to $115 from $137 and kept a ‘Buy’ rating on the shares following the incident.
• According to data from Koyfin, the 12-month average price target on ASTS is $86.40, representing a potential upside of about 7% from last close.

Shares of AST SpaceMobile Inc (ASTS) fell 5% on Monday but edged up 1% after hours on the heels of Wall Street dismissing concerns about Blue Origin's flagship New Glenn rocket failing to place one of its satellites into the intended orbit.

The company said on Sunday that its BlueBird 7 satellite, one of the many planned for its space-based cellular broadband network, was placed into a lower than planned orbit. The altitude is too low to sustain operations and hence the satellite will be deorbited, the company said, while adding that the cost of the satellite will be recovered under the company’s insurance policy.

AST further added that now it continues to target about 45 satellites in orbit by 2026-end.  

Wall Street Weighs In

BofA analyst Michael Funk said on Monday that the failure to successfully place BlueBird 7 in planned orbit on April 19th is a “negative shock,” but does not fundamentally change AST SpaceMobile's business.

The firm, however, sees risk to AST SpaceMobile meeting its revised target of approximately 45 satellites in orbit by the end of 2026. The company has plans to stack future launches with multiple satellites and expects BlueBird 8 to 10 to be ready to ship in approximately 30 days. Assuming launches every 1-2 months and average satellites stacked per launch of 5.5, this would leave a shortfall of about 7 satellites, the analyst said. The firm has a ‘Neutral’ rating on the shares with a price target of $100.

Clear Street, meanwhile, lowered the firm's price target on AST SpaceMobile to $115 from $137 and kept a ‘Buy’ rating on the shares. Like BofA, Clear Street also anticipates delays to AST's 45 to 60 satellite target by year-end 2026.

According to data from Koyfin, three of the 10 analysts covering ASTS rate it ‘Buy’ while five rate it ‘Hold’ and two rate it ‘Strong Sell.’ The 12-month average price target on the stock is $86.40, representing a potential upside of about 7% from last close.

How Did Retail Traders React?

On Stocktwits, retail sentiment around ASTS stock stayed within ‘extremely bullish’ territory over the past 24 hours, while message volume remained at ‘extremely high’ levels.

A Stocktwits user pressed the blame on Blue Origin for the failed satellite deployment, adding that AST is “beyond competence”

Another optimistic user called the failed satellite deployment as the best publicity the company could get.

ASTS stock has nearly quadrupled over the past 12 months. 

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