This $39 Billion Company Made Just $54.3 Million in the Last Year, but People Keep Buying It. Should You?

AST SpaceMobile (ASTS +0.47%) is one of the most aggressively valued stocks on the market. The company trades at a $39 billion market cap on just $54.3 million in trailing-12-month (TTM) revenue, a price-to-sales (P/S) ratio of over 382.

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NASDAQ: ASTS

AST SpaceMobile

Today’s Change

(0.47%) $0.42

Current Price

$89.90

Key Data Points

Market Cap

$26B

Day’s Range

$86.56 - $91.85

52wk Range

$18.22 - $129.89

Volume

362K

Avg Vol

16M

Gross Margin

-14399.31%

Why are investors paying such a premium for AST stock?

If the company can deliver on its promise, the payoff could be enormous. AST is building a satellite constellation designed to deliver cellular broadband directly to standard smartphones. Its partners include AT&T, Verizon, Vodafone, and now TELUS – carriers collectively serving billions of subscribers. If commercial service activates at scale, recurring revenue could reach tens of billions annually. It’s also recently landed a defense contract, adding another potential revenue stream.

Image source: Getty Images.

Is AST SpaceMobile worth the risk?

But that’s a lot of “ifs.” AST has a handful of satellites in orbit and plans to launch dozens more by year end, but it still has a long way to go, and there is significant execution risk.

At this valuation, you’re paying a premium for a future that’s far from guaranteed. Still, there’s enough of an opportunity here for investors with a very high risk tolerance.