AST SpaceMobile (ASTS) Might Be a UFO!
A new iPhone is being announced today and this might look like one of my previous doodles, but now my phone is so much thinner! But before I discuss why ASTS might be a UFO...
What's the Word on the Street?
As of me writing this, the major indexes are basically flat, except for the Russell which is down. The Nasdaq is at a record high while the market waits for the two inflation reports releasing on Wednesday (PPI) and Thursday (CPI). If either comes in hotter than expected, it shouldn't change the expectation that the Federal Reserve will be cutting interest rates later this month. But depending on how hot, it could affect the speed and aggressiveness of future rate cuts.
AST SpaceMobile (ASTS)
What Is It?
AST Spacemobile, Inc. engages in building a broadband cellular network in space to operate directly with standard, unmodified mobile devices based on an extensive IP and patent portfolio. It focuses on providing mobile broadband services with global coverage to all end-users, without the need to purchase special equipment. The company was founded by Abel Avellan on May 31, 2017 and is headquartered in Midland, TX. The listed name for ASTS is AST SpaceMobile, Inc. Class A Common Stock.
Why Is It a Possible UFO?
Primarily its current share price relative to its fair value and what other option traders expect are the reasons ASTS could be a UFO.
What About Recent News?
ASTS took a tumble today after an analyst downgraded the stock to Neutral and cut the price target from $62 to $43. There is a fear that ASTS may be overvalued and facing increased competition from SpaceX (which recently secured a $17 billion deal with EchoStar).
What's the Current Price?
ASTS has had a great run over the past year, but since the beginning of 2025 it's gone up ~77%. It fell ~20% in the past month, ~24% on the week, and ~8% on the day.
What’s the Fair Value?
I’d first like to emphasize that fair value is subjective. Many analysts at many banks and institutions rate stocks differently and assign fair value in their own unique way. So, what I like to do is take all the recent fair values since the most recent earnings report and average them. In this case…
Since ASTS's most recent earnings report on 08/13/2025, it has received 2 ratings. But the ratings were issued by the same person, so I’m only taking their most recent one...which means there is nothing to average! So the fair value according to Christopher Schoell at UBS is $43 as a Hold.
What Do Options Traders Expect?
Calls are trading over equidistant Puts, which means traders think there is a chance to the upside. You can see because… forget about the green columns and focus on the red. Notice how on the right side for the $33 Put it says $1.64, it’s $2.31 for the equidistant Call at $44.
The premium (the credit you receive for executing the trade) is currently less for selling Puts, as opposed to selling Calls. Basically because of that, option traders expect the stock to go up, rather than down.
How About Volatility?
The IV rank (the purple line) for ASTS (stock price in blue) is currently hovering around 13.46, which is somewhat low (IV rank goes from 0-100). This makes short strategies (which are what I prefer) less attractive.
What's the Trade?
My preferred trade is a variation of the wheel without the rolling, AKA cash-secured puts. I typically like to target stocks that offer a dividend and are below fair value.
Why a dividend? If the trade results in assignment and I’m on the hook for X amount of shares, I can at least be satisfied knowing I picked a (hopefully under fair value) company that will pay me a small amount while I run the other side of the trade AKA covered calls.
ASTS does not offer a dividend, but that’s not a dealbreaker!
It’s a fairly low-risk strategy (all options trading is risky!), that has a higher probability of success, but requires a higher amount of collateral.
So if you saw the most recent image above, I already STO (sold to open) 1 contract of the $33 Put for the October 24th expiration. I like to have a DTE (Days To Expiration) that is around ~45 days.
When the trade reaches 50% profit I will buy it back. I don’t like to be greedy and go for more profit, because I would rather not waste my time being in a trade for too long.
What About Alternative Trade Ideas?
- If the collateral requirement is too high, another idea is a put credit spread. You would sell a put at a strike below the current share price and then buy a put at a lower strike than the put you sold. By doing so, you will avoid the collateral requirement of a cash-secured put, but the credit received will be smaller. Also, if the trade goes sideways, you will not be assigned shares so no collecting dividends and running covered calls afterwards.
- Just invest! 1 share or even fractional shares are a way to get a foothold in a stock that you think might increase in value.
Completed Trades
Dino Silvestro
BTC with 50% profit
Dino Silvestro
BTC with 50% profit
Wait…Where Are the Candlesticks? And All the Other Indicators?
I know many traders love their candlesticks and a ton of indicators. I prefer simplicity. Candlesticks aren’t necessary unless you’re the kind of trader that wants to try and pick the perfect moment to execute a trade, and even then it’s not a sure thing.
As for indicators, there are a ton. Some of them work sometimes. None are perfect. I don’t want to get bogged down with too many. You’ll drive yourself crazy looking at too many of them, so find a handful you like and stick with those.
Disclosures
- I currently have an open trade with ASTS (as mentioned in this post).
- No trade is a sure thing. There is always risk involved.
- This blog post is not meant to take the place of financial advice, but hopefully acts as a guide for learning or informational purposes.