Why AST SpaceMobile Stock Just Crashed 10%

AST SpaceMobile (NASDAQ:ASTS) stock tumbled 10.5% through 10:10 a.m. ET this morning on what -- one would think -- was actually some pretty good news. (And as we'll see, that may be the problem.)

Overnight, SpaceX successfully launched five AST BlueBird satellites into orbit from its launch pad at Cape Canaveral. Once set in their orbits, says AST, it will begin offering "approximately 100% nationwide coverage from space with over 5,600 coverage cells in the United States," with data download speeds up to 120 Mbps.

Buy the rumor, sell the news

Admittedly, this wasn't unexpected. While it may not be quite a "buy the rumor, sell the news" situation, it's at least a kind of "buy when you think something's going to happen, and sell when it does" event. AST's BlueBird launch has been on SpaceX's manifest for months, and today's launch was foreknown.

Still, it was arguably the biggest catalyst lifting AST stock from $2 and change back in May, to nearly $39 in August. Now that the catalyst has been completed, there's not a whole lot for investors to look immediately forward to as regards AST stock, and momentum traders may have decided it's time to take profits -- especially since the chances of AST proceeding from here to generate significant revenue from connecting 5,600 phone calls isn't great.

Is AST SpaceMobile stock a sell?

Investors selling off AST SpaceMobile stock today may be departing too soon, however. While there are certainly risks the stock will suffer going forward (from ongoing stock dilution, for example), consider all the catalysts that still remain to be fulfilled.

Those include announcements that the BlueBirds are in their orbits and operating as designed, announcements of the first completed calls from the new satellites, and announcements of additional and expanded corporate partnerships from telecoms that will help raise the funds AST needs to launch even more satellites and scale up its business.

All these still lie in AST's future, and all have the potential to drive the stock higher again.

Should you invest $1,000 in AST SpaceMobile right now?

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Rich Smith has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.