AST SpaceMobile Sinks on SpaceX's Spectrum Deal, but Berenberg and Roth Say It Could Become Carriers' Best Ally

AST SpaceMobile (NASDAQ: ASTS) sold off Friday after SpaceX agreed to buy a nationwide portfolio of low-band spectrum, a deal that sharpens SpaceX's push to become a mobile carrier. The stock was down 11.51% at $50.38 (down $6.55) in a later quote, after trading down 12.77% at $49.66 at 12:56 PM ET, close to its 52-week low of $49.31. At least one report put the decline at nearly 15%. The stock closed Thursday at $56.93.

Why AST fell

AST builds a satellite network that connects to ordinary smartphones, and it sells through carrier partners such as AT&T and Verizon. SpaceX's deal for Grain Management's 800 MHz licenses, up to 14 MHz of paired low-band spectrum, lets it build a competing network that pairs its own satellites with terrestrial equipment. SpaceX's COO Gwynne Shotwell reportedly said the company plans to target existing wireless carrier customers. Investors worried about what that does to AST's coverage, pricing and differentiation.

The stock also entered the day under pressure. It had dropped about 6% on Thursday, was down roughly 32% for the year, and sits about 61% below its 52-week high of $133.86. Recent concerns include satellite launch delays, a $125.9 million write-off tied to the BlueBird 7 satellite failure, a $1 billion convertible debt offering that pushed the 45-satellite constellation target back to early 2027, and six straight earnings misses, according to Investing.com. B. Riley downgraded the stock to Neutral on Oct. 2, and William Blair cut its 2027 revenue forecast.

The analyst counterargument

Berenberg's Michael Filatov called the sell-off unjustified and kept his Buy rating. His argument is that SpaceX becoming a carrier itself leaves AST as the natural satellite partner for operators competing against it. Berenberg describes AST as the only direct-to-device operator whose technology supports broadband to existing phones while partnering with carriers. Roth Capital similarly sees AST becoming a preferred satellite-to-phone partner for the large U.S. carriers that want to compete with Starlink Mobile, and Roth has reiterated a Buy rating with a $108 price target.

Ratings are as reported by Investing.com and Stocktwits. Price targets are opinions and can change.

What AST says

CEO Abel Avellan responded on X without naming the SpaceX deal. He said American operators hold about 1,000 MHz of low- and mid-band spectrum that can be tuned onto AST's network, and that, combined with the 45 MHz of L-band spectrum AST controls, users could see peak data rates of nearly 200 Mbps. That is a peak figure, not a typical speed. AST's existing commercial arrangements with AT&T and Verizon are unchanged by the Grain sale.

Tower companies benefit

Cell tower owners rallied. American Tower gained about 8% and Crown Castle about 13%. Bernstein has estimated a standalone SpaceX network that could compete with the major carriers could cost $50 billion to $130 billion to build, which makes leasing existing towers attractive. Goldman Sachs expects the 800 MHz spectrum to be deployed on towers in metro and urban areas. SpaceX has not committed to a nationwide ground network rollout, and advances in satellite technology could reduce its reliance on towers. See our full recap of the telecom sell-off.