$ASTS: Know What You Own

on the retail side have pitchforks out for any management teams, right? Whether it's, you know, I saw people really upset with RocketLab, the NeoCloud companies, Quantum, any of them. I mean, you just picked. You just throw a dart and people are upset that management for XYZ companies not doing enough, they're lying, they didn't put out enough PR, whatever it is, right? And I think that's the kind of the mentality that we live in now with social media where people need instant gratification. And, you know, I pointed this out the other day to someone where a long time ago, maybe 20 years ago, 15 years ago, there was no such thing as social media. And a company would PR things that were material from time to time, but you would have to wait for quarterly updates to get any material news from the company. And that was it. There was no social media post on production, on shipping, unfolding satellites, any of that stuff. And so I think it's important to have that context in mind where, you know, companies, there are, by the way, there are companies that are very good PR machines. They're marketing machines, and that's what they're good at. And there are companies that aren't as good at that. And they might be focused on doing something that's really difficult, right? Not to say that those two things can exist at one time, but as I've explained before, the DNA of this company is not really to be promotional. You know, maybe that will change over time, but if I had to choose between a company that was focused on execution versus one that is promotional, I would take the latter, not the former. Or sorry, I would take the former, not the latter. But you know, it is important. I think it's obviously fair to question management. If you missed deadlines, you know, that can impact the confidence that you have in a management team. And obviously people can discount what that management team would say or project for the future. And so that's fair. But I think also you have to kind of look at what the underlying business is and what they're doing, right? So I've talked about this in the past where if it's a company that's making widgets that they're selling at Walmart, and you know, the level of execution there is probably a lot easier than what AST is doing. Then you have to give the management team some room, right? And you have to look at their body of work. Yes, there's been delays over the years. But what are they trying to do? You know, yesterday I looked, I watched the SpaceX video on the development of Starship and also the chronology of Falcon 9. And it is absolutely amazing what they did. They did with Falcon 9, they did something that was impossible. I mean, it's difficult to build a medium lift rocket or back then that was a heavy lift rocket that can get to orbit as reliably. And then they then they created one that returns the first stage, which was unheard of. And then now with Starship, they're looking to return both stages. And that's a really difficult problem to solve, right? It's something that people thought was impossible. And so looking at what they've done with Starships thus far, you can't really take away anything from it, right? Because they're doing something incredibly difficult, viewed as impossible. I think there was that famous video of Arian, one of the executives saying, you know, reusability is a fantasy, right? But they are, they're doing it. But that said, you know, can you criticize Elon Musk for the timeline? Sure. You know, Starship, I think this was back in 2017, he was projecting Starship to land to landing humans on Mars in 2022. Right? And so we're what, four years behind that. And probably another two to four years, probably more like four years away from landing humans reliably on Mars. Are people going to be upset about that? Who invested in SpaceX? Not really, because they understand the difficulty of the problem, right? And so similarly, if you look at AST, there was a, in Paris, there was some article talking about directed device, how originally it was just AST and SpaceX. And it was known was really talking about it. Whereas this past week, it's everything. It's the only thing people were talking about directed device. And it was something back in 2018, 2017, when, when, about conceived the idea of creating satellites that could deliver broadband service to an unmodified phone, people viewed that as an impossibility. They thought he was nuts, right? And then now, all fast forward to today, it's now it's accepted that inevitably we're going to get there, right? And so for AST, we are already doing that. And so now it's a matter of execution of delivering satellites to space, right? Producing them and delivering them. And that's, that's not an easy task to do, right? And, but I think it's important to see the progress that, you know, people are focused on the actual satellites being shipped. But there's also a ton of progress around that, right? And so there are specific reasons why that's been delayed. And I'll talk about that in a bit. But it's also to look at, well, what's going on? What's going on around the company? What's going on in the background? Does this tell you that things are being stalled or that there's a ton of progress being made in parallel? There was this one, I think they were a Korean investor, they were saying, you know, the entire production line should shut down and they should just focus on fixing if there was an issue with Bluebird 14, they need to fix it and then and then ship it. And it's like that's not how real companies work. Like if you go to Hyundai and they build a car and there's an issue with it and they have to go send it back and get it fixed, they don't stop the entire production line, right? And so they they keep going. And if anything with AST, they're actually expanding the production line because they are looking to develop to produce many Bluebirds beyond just six, but getting to 10 to 12 a month and their technic steps to do that. And there's also this potential for them to have multiple launches in Q4 where they need to be ready with those satellites. But yeah, it's a complex problem solve, right? It's not an easy one. If it was an easy one, everybody would be doing it. And quite generally there are more because they see the opportunity, there are more people trying to do it. And guess what? They're going to go through the same hell, right? This is the Tesla hell production hell, right? You got to get through that hump and then once you get through it, then my god, like unleash, you know, unleash hell, like that's when that's when things really start cooking. But you know, this past drawdown, there's been this constant whining of people needing PR. And so the company gave you PR, right? And then people are upset that it's not the PR they wanted. They're like, well, they need to ship the satellites. I wasn't asking for that PR and it's like, well, the company is giving you some update on production. And they told this, you know, Bluebirds 48. That's what they're working through. And they also gave us an update on fact that in Antonov dropped off even more composite rings. And so they're doing a lot of this stuff in parallel. But people, people got upset with the company, right? Like they sent out this proof of a live PR and people got upset. And they're like, we need PR, we need up, we need material updates. I mean, satellite shipped. What's going on? Bluebird 11? And so the company sent out a PR and then they got lambasted for it, at least for I guess people who are unstable. And so if you're the company, it's like, oh, okay, so I guess we sent out PR and people get upset. Maybe we should not send PR out, right? Like, what's the point of that? Because it seems to have riled people up even more. And so I don't know, I think I think folks should look in the mirror and just ask themselves, like, what am I trying to accomplish? Right? Like, clearly, Abel and the rest of the team are aligned. You know, they're fully invested. They have equity in the company. They're trying to push this thing forward. And then you've got these people on the outside who are upset. And I don't know. Like, what's the point of, of, you know, destroying morale or whatever? I don't know how you would count it. But yeah, the company's damned if you do, damned if you don't. Like, okay, we'll provide some more communication. Okay, it's not the right type of communication and people get upset. It's just like when I think when, what was it? The last batch of Bluebirds, there was one that was unfolded and people are like, oh my god, that would happen to you there, there too. And it's like, this is a process, right? And people are upset. It's like, they didn't give us enough day in the other two. And then, of course, the other two unfolded later. And, you know, we've talked about it amongst Space Mob that, you know, Bluebirds, the most recent Bluebirds, 11 and 12, sorry, 12 and 13 were unfolded very quickly because the company is testing out different processes, right? And so they unfolded this quickly and then Bluebird 11, it seems like maybe they're doing a bit of an orbital raise and they might be flying the satellite into bar configuration. And then they'll open it up later, right? And so, you know, someone's like, well, they need to communicate all these things to us and it's like, no, these are these are these are these are industry secrets. The company is learning from them. These are things that you don't give away to other competitors, right? And clearly, it's not just Starlink and AST that are pursuing this market. There's a whole there's, you know, several other companies that see the massive opportunity they're trying to pursue it as well. Like, why would you give those things away? Those learnings. But yeah, I think it's important to have some perspective. You know, the sector is trading together in tandem. And so, if you look at somewhat, you know, there's like these new ex accounts that are like, you know, the stock is up. So something positive must be coming or the stock is down. Something negative must be coming. It's like, hey, guys, just look at the rest of the sector, right? There's nothing, I'll be the first person to tell you that there's the the the factor of space and momentum is up today. And that's why AST is up, right? There's some relief. And so should from my fair value perspective, should AST have been in the 50s? In my opinion, no, it should be much higher. And I think you could ask a sure little rocket lab should it be down should have been in the low 60s or 50s, no, or some of the other companies. But I mean, just take a step back like for the people who, and this is this is the kind of the, you know, when investors are looking for answers where they're like, why is the stock up today or why is it down today? And if it's down, it's like, it's management's fault, they need to do something. And if it's up, it's like, oh, this is great. I, you know, it's a great investment. It's up today because of the rest of the sectors up, right? Like rocket lag is up 6%, black sky is up almost 8%, you know, in two to machines, 8.5%, planet lab 6%, the red wire 7.7%, firefly 8%, right? And so, yeah, the sector is up. This is a relief rally. And so all these names have been beaten down and they're up. And there's not a specific, the, the, the reason is that post-fed meeting, now that people view that the fed is going to get their, is going to be vigilant about inflation. And so by not by having a, an investing backdrop that is positive in terms of its inflation is under control, the economy seems doing doing well, these growth sectors doing well, then stocks are up, right? Like, I think, I agreed with JV Morgan, if the fed had cut rates yesterday or it's or stayed flat, that would have been bad, right? Because then the market would would have threw up over that saying, oh, the fed's not serious about inflation. And so we have to price in risks that inflation could run away. And then they'll have to raise, they'll have to even more restrictive than they then nipping into the butt now. But, but yeah, it's, you know, when, when you do have a drawdown, I mean, we've seen this every single time with AST, when you have a drawdown, the, the pitchforks come out and the, the level of sentiment, it's, it's very, you know, the negativity, it's very cute, right? It's, it's like, you know, there's this pursuit, like there's, there's a few accounts out there where they just go nuts, right? And, and especially, you know, it's not always, but there are some accounts that you end to invest in leverage, right? And, and use options. And, and so the sensitivity of volatility tends to be more acute, right? And so just keep that in mind. I mean, and I would say also, I just noticed this as well. I for the, for the last week or two, I've pretty much been busy. So I haven't been paying much attention to the timeline. But there's a lot of new anonymous accounts that are posting negative stuff like accounts that have, that were started in July, August, June. And it's like, oh, it's very clear what you guys are doing. You know, it was funny. There was this, there is this hedge fund. Analyst that I talked to you and he, he's great. He's long, he's one of the few guys out there that are long. But he actually spoke with Baronberg, research analyst post coverage initiative, initiation of coverage. And, and the, the analyst told him that a vast majority of folks were hedge funds, you know, after you initiated coverage in post a few notes, were hedge funds that were short the stock and were upset he was writing. And, and these guys like there, they're, they're also spending time that maybe they can pay people a few bucks an hour to go post a negativity on X and read it like it totally exists. It happens, right? And so just be, just be wary of like where, where