Why AST SpaceMobile Stock Popped on Monday

AST SpaceMobile (ASTS 5.54%) stock rose another 5.8% through 12:05 p.m. ET Monday, continuing a rise that began on Friday afternoon. And why is it going up?

Just before noon Friday, AST announced that all of its first flight of five BlueBird direct-to-cell communications satellites have successfully unfurled their solar panels.

What this means for AST SpaceMobile

When AST SpaceMobile launched these five satellites in September, it promised that once activated, they would be able to support “approximately 100% nationwide coverage from space with over 5,600 coverage cells in the United States.” At the time, I predicted that reports of successes such as this one could serve as catalysts to incrementally boost the stock price.

That’s exactly what seems to be happening as news of the successful “unfolding” filters out.

AST noted that the success puts it “ahead of schedule” on rolling out its direct-to-cell service, and says it is “now preparing for commercial and US government operations.” Investors can look for future announcements about the first call placed successfully via the satellites, and the beta rollout of services using them, to serve as further catalysts for the stock price.

Is AST SpaceMobile stock a buy?

That’s the near-term view. Longer term, AST’s prospects aren’t quite so clear.

While AST has successfully signed up telecom industry majors such as AT&T, Verizon, and Vodafone as partners, it remains to be seen how profitable these partnerships will be, or whether AST will be able to generate enough revenue — and at high enough levels of profitability — to make its investment in $3 billion worth of communications satellites worthwhile.

With a market capitalization of more than $5 billion, essentially no revenues, and, of course, no profits yet, AST SpaceMobile remains a speculative stock.