Why AST SpaceMobile Stock Sank Today

Key Points

• EchoStar is selling some of its 5G spectrum licenses to SpaceX.

• SpaceX's Starlink competes with AST SpaceMobile in "direct to cell" satellite phone services.

• Roth Capital remains optimistic about AST SpaceMobile stock, though the company is unprofitable and lacks appreciable revenue.

• 10 stocks we like better than AST SpaceMobile ›

Satellite communications company EchoStar (NASDAQ: SATS) announced on Monday morning that it will sell two blocks of 5G spectrum to SpaceX for use by its Starlink internet and "direct to cell" mobile communications service.

This is great news for SpaceX and great news for EchoStar. At last report, EchoStar stock was up nearly 18% on the news. One bunch of investors that's less thrilled with the development, though, are those who have been investing in Starlink rival AST SpaceMobile (NASDAQ: ASTS).

Where to invest $1,000 right now? Our analyst team just revealed what they believe are the 10 best stocks to buy right now. Continue »

As of 10:20 a.m. ET, AST SpaceMobile stock was down 5.7%.

Image source: Getty Images.

SpaceX versus AST SpaceMobile

As Roth Capital explained Monday in a note covered on TheFly.com, EchoStar's "fire sale" will help Starlink bulk up on spectrum it can use to provide commercial services on the cheap. This puts "pressure" on AST SpaceMobile shares, based on the theory that what's good for SpaceX is necessarily bad for its competitor.

Roth doesn't share this view -- and he remains optimistic about AST SpaceMobile, putting a buy rating and a $56 price target on the stock, which currently trades at around $40.

As the analyst explains, SpaceX now "will require next-generation satellites and a smartphone refresh" among subscribers to partner T-Mobile (NASDAQ: TMUS). Meanwhile, AST retains strong alliances with cellphone providers including AT&T (NYSE: T) and Verizon (NYSE: VZ).

Is AST SpaceMobile stock a buy?

I'm not so sure Roth is right about that. SpaceX's strategy already involves steadily replacing old Starlink satellites with upgraded ones, so I doubt that's really a concern. As for AST SpaceMobile, the company has a market cap of $14 billion, yet it lacks both profits and any appreciable revenue. (Total revenue for the past year was less than $5 million, according to S&P Global Market Intelligence data.)

It seems to me that SpaceX is winning this race. AST looks stuck in neutral.

Should you invest $1,000 in AST SpaceMobile right now?

Before you buy stock in AST SpaceMobile, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and AST SpaceMobile wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $670,781!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,023,752!*

Now, it’s worth noting Stock Advisor’s total average return is 1,052% — a market-crushing outperformance compared to 185% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.

See the 10 stocks »

*Stock Advisor returns as of September 8, 2025

Rich Smith has no position in any of the stocks mentioned. The Motley Fool recommends T-Mobile US and Verizon Communications. The Motley Fool has a disclosure policy.