Should You Buy AST SpaceMobile Stock While It's Trading Below $60?

AST SpaceMobile (NASDAQ:ASTS) went public a little over five years ago, and it has been a hot growth stock to own since then. Over the past five years, its value has risen by more than 450%.

However, since the start of this year, there's been some significant pullback as investors worry about the risk that Space Exploration Technologies Corp, better known as SpaceX, poses to its growth. Both companies are working on creating cellular networks in space, and with SpaceX being more popular and CEO Elon Musk attracting a lot of investors, AST SpaceMobile may be a less captivating investment option right now.

Its decline in value, however, makes the stock potentially more attractive to buy. Is AST SpaceMobile stock worth investing in while it's trading below $60?

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The company has been experiencing significant growth, and more could be on the way

AST SpaceMobile reported its latest earnings in August, and they showed incredible growth. Its revenue totaled $31.5 million, a significant increase from the prior-year period, when its top line was less than $1.2 million. The company has experienced tremendous growth, with gateway deliveries up and its business with the U.S. government taking off.

This year, the company expects to generate between $150 million and $200 million in revenue. Its revenue backlog is also fairly high at $1.3 billion. The company has agreements with 60 mobile network operators, which combined cover more than 3 billion subscribers. Partnering with MNOs is crucial for AST to expand its growth opportunities and provide cellular services.

The challenge, however, will be in getting to breakeven, as the company is incurring significant expenses amid its growth. Last quarter, its net loss totaled $230.9 million, which was a sharp increase from $99.4 million a year ago.

Is AST SpaceMobile stock worth buying while it's trading below $60?

AST SpaceMobile stock isn't quite at its 52-week low, which is less than $50, but it is down close to 60% from its high of nearly $134. For investors, now may be a more intriguing time to invest in the promising growth stock, as a lower price point can provide more margin of safety, compensating investors for the risk they're taking with the unprofitable business.

The company is growing significantly and has much more potential in the future. While it's by no means a risk-free investment, at nearly $23 billion in market cap, it isn't a terribly massive company. Even though it's competing with SpaceX, the industry is likely large enough for both of them to succeed.

Buying AST SpaceMobile stock could be a good move right now, but investors should be willing to hang on for the long haul and be comfortable with volatility.

David Jagielski, CPA has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends AST SpaceMobile. The Motley Fool has a disclosure policy.