AST SpaceMobile (ASTS +4.16%) stock is making big gains Tuesday thanks to signs that the space industry will receive elevated support under the new Trump administration. The company's share price was up 10.1% as of 1:40 p.m. ET and had posted gains of as much as 11.3% earlier in daily trading.
NASDAQ: ASTS
Key Data Points
Space stocks are rallying today following comments made by President Trump at his inauguration, and AST SpaceMobile is among the companies getting a valuation boost. In particular, investors seem to be excited about Trump's plans to support a mission to send U.S. astronauts to Mars.
AST SpaceMobile stock surges on Trump's Mars mission comment
Speaking at his inauguration event yesterday, Trump said, "We will pursue our manifest destiny into the stars, launching American astronauts to plant the Stars and Stripes on the planet Mars."
As a provider of satellite-based broadband cellular service, it's not immediately clear how such an initiative would benefit AST SpaceMobile's business. On the other hand, support for the space industry under the Trump administration could create opportunities that wind up benefiting the company and lead investors to assign higher valuation multiples to businesses in the category.
What comes next for AST SpaceMobile?
The space industry is heating up, and stocks with exposure to the trend have been posting big gains recently. With today's rise, AST stock is now up 637.5% over the last year. The company has a market capitalization of $4.6 billion and is valued at approximately 64 times this year's expected sales.
AST's valuation is highly growth dependent, and the company is still in the early stages of commercializing its telecommunications offerings. With its third-quarter report, the company posted sales of $1.1 million. The performance brought the company's total sales across last year's first three quarters to $2.5 million, improving from zero sales across the prior-year period.
AST's forward price-to-sales multiple suggests that analysts expect the company's revenue to ramp up rapidly this year. Depending on whether the business misses, matches, or exceeds Wall Street's growth targets, the stock will likely wind up making some big moves in 2025. Macroeconomic trends and government-related projects in the space industry are poised to be significant catalysts as well.
