AST SpaceMobile Stock Plunges as Analyst Turns Bearish, Citing Valuation Concerns

AST SpaceMobile (ASTS) is facing renewed scrutiny as Barclays double downgraded the stock, sending shares tumbling in pre-market trading. The analyst's shift from “Overweight” to “Underweight” reflects concerns that the company's valuation has become excessive, despite acknowledging the significant potential of its direct-to-cellular technology.

This bearish sentiment is weighing heavily on ASTS, which has enjoyed a remarkable 313.59% year-to-date gain. ASTS' stock has pulled back 6% in pre-market trading, following on from a 6.47% drop during Thursday's trading session, indicating growing investor anxiety.

The downgrade comes even after Barclays themselves had previously raised their price target for ASTS to $60, maintaining an “Overweight” rating just weeks ago, highlighting the rapidly evolving sentiment surrounding the stock. ASTS trades 117.29% higher over the past month, with valuation catching up, and passing the mark on the way.

Barclays analysts, while acknowledging AST SpaceMobile's key assets and the very attractive direct-to-cellular opportunity, emphasized that the stock's current price may not be justified. This assessment underscores the delicate balance between the company's promising technology and the market's perception of its intrinsic value. The firm maintains a price target of $60, suggesting that they believe the current market price has overshot their assessment of fair value.

Competitive Landscape Intensifies

The competitive landscape is also intensifying. SpaceX's acquisition of 5G spectrum from EchoStar signals its intent to enter the space-to-cellular market, posing a direct challenge to AST SpaceMobile. This development prompted UBS to downgrade ASTS from “Buy” to “Neutral,” with a price target reduction from $62 to $43, reflecting the growing competition in the satellite communications industry.

Despite these headwinds, AST SpaceMobile has secured strategic partnerships that could prove beneficial in the long run. The early October 2025 announcement of a collaboration with Verizon to offer space-based cellular services starting in 2026 initially boosted the stock, with shares surging over 10%.

This partnership leverages Verizon's 850 MHz low-band spectrum to extend coverage to remote U.S. areas using AST's satellite technology. The company also has launch deals with Blue Origin, and a partnership with AT&T to provide space-based broadband.

The recent analyst downgrade underscores the market's growing concern that AST SpaceMobile's valuation may have outpaced its fundamental performance and competitive positioning. While the company's technology and strategic partnerships hold promise, this is a rapidly evolving market, and momentum stocks are prone to corrections during risk-off periods.