Why Is AST SpaceMobile Stock Plunging Today?

Oct 7 - AST SpaceMobile ASTS shares dipped sharply on Tuesday after the satellite communications company signed a new $800 million Equity Distribution Agreement with several major financial firms. The move gives AST SpaceMobile flexibility to sell its stock through at-the-market offerings over the next three years, with agents earning a 3% commission on sales.

The firm's long list of agents includes B. Riley Securities, Barclays Capital, BofA Securities, Cantor Fitzgerald, Deutsche Bank Securities, Roth Capital Partners, Scotia Capital, UBS Securities, William Blair, and Yorkville Securities. The company emphasized it has no obligation to sell the full amount or issue shares immediately, providing room to pace its fundraising based on market conditions.

Management said proceeds from the offering will support general corporate purposes, and leadership will have discretion over how to allocate the funds.

ASTS stock slipped roughly 5% on Tuesday but remains up more than 220% year-to-date after a strong 12-month rally of over 180%. Trading volume reached around 3 million shares, below its three-month average of 11.8 million, as investors weighed the dilution risk against the company's capital-raising flexibility.