AST SpaceMobile raises $1 billion in convertible debt, sparking dilution concerns and a 13% stock decline to $57.63.
AST SpaceMobile shares fell 13% to $57.63 after the company priced a $1 billion convertible senior notes offering due 2034. The move extends a 27% decline over the past month, driven by investor concerns over dilution and elevated volatility.
The offering includes 1.625% convertible notes with an initial conversion price of $79.57, a 20% premium to Wednesday’s close. Capped call transactions raise the effective conversion price to $149.20. Analysts note acquisition language in the 8-K filing, suggesting potential vertical integration similar to Rocket Lab’s strategy.
Piper Sandler initiated coverage with an Overweight rating and a $100 price target, while the Street’s consensus stands at $81. The stock is testing levels last seen in the spring, with the July 17 put/call ratio at 1.04, signaling bearish sentiment ahead of weekly expiration.