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ASTS sitting in a great position for strong bounce despite competition from SPCX.
Analysts are quietly watching SPCX and adding up these costs and realizing that with perfect execution it could be 10 years before the profits start to come in. Staggering costs could easily outweigh the lofty business plans.
SPCX has 4 segments that will put a significant stress on the bottom line, and a tipping point will occur.
\--Development of a space cell network: cost about 200B-400B+ for infrastructure of 10,000 satellite constillation dedicated for this purpose, Hurdles: need to buy a cell provider to have access to cell frequency, develop and market a SPCX cell phone not compatible with any other provider, complete grass roots development will be extreme costs.
\--Aggressively developing/deploying AI datacenters: Terafab 50B+ to develop chips, satellites constellation of 1m in space 500B-1T+.
\--development of rocket technology (starship) and space exploration: 200B-500B+.
\--Broadband internet service (20B to sustain current market, 100B+ to upgrade/update to higher speed).
Competitive threats: This is in a perfect scenario where SPCX completely wipes out the 3 big cell carriers and there are no hiccups with deployment/development/FCC regulations/Global government regulation adoption. Other segments have other competitive threats: RKLB, AMZN, Alphabet, MSFT, Space/satellite Stocks, Global threats: Rakuten, Vodafone, China.
\--The big 3 cell carriers scrambling to protect their position.
Already announced support and alliances with ASTS to provide satellite service for them using their carrier signal frequencies. TM selling Grain their 800mhz fZ, ASTS already frontrunner to lease signal.
ASTS has ability to start supporting limited service at 25 satellites. This places Q2 2027 to be the inflection point. Q4 2028 At 45-60 satellites full service is possible including global.
Q2 2027 SPCX mobile infrastructure starts to be built, SPCX cost 200B+, if able to sustain growth Q4 2028 starting service, staggering cost 200-400B+.
My plan in motion:
There is a strong probability that SPCX will overextend itself. Too many positives for ASTS to ignore:
\--Requires a fraction of satellites to achieve full coverage, significant cost difference.
\--The big 3 are supporting ASTS. They are already on the defensive against SPCX.
\--ASTS business model is clear, 1 goal, provide satellite cell service, recover costs and make profit as an operator similar to cell towers.
\--Have a developed product, IP using highest quality ASIC chip designed by Cadence, and built by TSMC. Developed a satellite antenna capable of mimicking cell towers, no special phone to buy, $20 can get a phone from Walmart capable of connecting.
\--Analysts forgot about, markets in Europe, Asian Islands and coast, Pacific Islands, Africa, still a few customers overlooked to provide a tiny bit of revenue (could be the real enchilada in reality).
\--Government contracts for Spaceforce, Government military planners like the ability to use global cell service, observed the effectiveness of using cell comms in Russo/Ukraine war.
Plan:
Currently have acquired 1000 shares, recently over last 2 weeks, cost basis: 72/share. Acquired 2nd 500 shares last week.
Total cost: 72,000
Group A 500 Shares:
\*\*7-1-26 placed 5 calls 10-16-26, 7.35 premium. Income 3675.
\*\*Close 5 calls October 2026, .2 to 1.0, cost -300.
\*\*Price inflection 90 to 120, Place 5 calls September 2027, 150 strike, 12.00 premium, Income 6000
\*\*September 2027 close calls, .2 to 1.0, cost -300.
\*\*Expecting satellite deployment October/November, price inflection 110 to 130, place 5 calls December 2027, 170 strike, 15.00 premium, 7500 income.
Group B 500 shares:
\--August deployment of next 3 satellites, expecting price inflection 90 to 120, to place 5 Calls, targeting January 2027, 150 strike, 12.00 premium, Income 6000
\--January 2027 close calls, .2 to 1.0, cost -300.
\--Expecting satellite deployment January to March, price inflection 100 to 120, place 5 calls Dec. 2027, 170 strike, 12.00 premium, Income 6000.
\--December 2027, allow 1000 shares to be assigned
Total profit:
Stock: 98,000
Calls: 28,275
total net profit: 126,275
% return on investment: 175% over 17 months or 10% / month return.