We recently published a list of 10 VLEO Technology Stocks and Startups to Watch in 2025. In this article, we are going to take a look at where AST SpaceMobile Inc. (NASDAQ:ASTS) stands against other VLEO technology stocks and startups to watch in 2025.
Very Low Earth Orbit (VLEO) refers to altitudes below 450 km, much lower than traditional low Earth orbit (LEO), which typically includes altitudes between 500 km and 2,000 km. This emerging sector in the space industry offers numerous advantages, including lower latency for communications, higher-resolution imaging capabilities, and reduced launch costs. However, operating in VLEO also presents challenges such as increased atmospheric drag, requiring innovative propulsion and station-keeping technologies. VLEO technology is gaining traction as companies seek more efficient ways to deliver high-speed broadband, enhance Earth observation capabilities, and support national security initiatives. The increasing demand for global connectivity, precise geospatial intelligence, and real-time satellite-based data services is driving investments in VLEO solutions. Governments, defense agencies, and commercial enterprises alike are exploring VLEO applications for sectors such as telecommunications, agriculture, disaster response, and environmental monitoring.
From an investment perspective, VLEO-related stocks and startups offer exposure to one of the fastest-growing segments of the aerospace industry. Companies involved in VLEO range from established aerospace giants developing cutting-edge satellite technology to emerging startups focused on specialized propulsion, high-resolution imaging, and space-based communication networks. The rise of private-sector space initiatives, alongside increased government contracts, provides a strong growth outlook for businesses operating in this niche – for reference, external research boutiques such as Juniper Research estimated that investments into VLEO will reach $220 billion by 2027, from only $17 billion in 2024, implying an annualized growth rate of 135%.
Investors interested in space technology stocks should consider VLEO companies for several reasons. First, the commercialization of space is accelerating, with increasing private-sector involvement from leading firms. Second, VLEO satellites can provide more cost-effective alternatives to traditional LEO and geostationary orbit systems, creating opportunities for companies offering facilitatory or complementary technology in this space. Finally, the sector benefits from strong long-term tailwinds, including advancements in artificial intelligence, cloud computing, and 5G networks, which require faster and more efficient space-based infrastructure. With this, we will take a look at some of the best VLEO stocks to invest in.
Our Methodology
We shortlisted 10 names, which include both publicly traded companies as well as private companies and startups. We ranked the names by market capitalization or the amount of funding raised as we believe the company’s size correlates with the potential to gain a substantial market share by either facilitating or complementing the rapid growth of the VLEO technology market. For publicly traded companies we also include the number of hedge funds that own it.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 363.5% since May 2014, beating its benchmark by 208 percentage points (see more details here).
An aerial view of a communications satellite in orbit, beaming its signal down to Earth.
AST Spacemobile Inc. (NASDAQ:ASTS)
Latest Valuation/Funding Estimate: $6.43 billion market capitalization
Number of Hedge Fund Holders: 18
AST SpaceMobile Inc. (NASDAQ:ASTS) is revolutionizing global connectivity by developing the first space-based cellular broadband network designed to provide direct-to-device internet access. The company’s technology allows standard mobile phones to connect directly to its VLEO satellites, eliminating the need for ground-based infrastructure in remote and underserved regions. This breakthrough has the potential to bridge the global digital divide, offering seamless coverage in areas where traditional cellular networks struggle to reach.
The company’s constellation, known as BlueBird, will operate in VLEO, significantly reducing signal latency compared to higher-altitude satellite networks. By maintaining a closer orbit to Earth, ASTS can provide faster data speeds and lower latency, making it a game-changer for mobile network operators looking to expand their coverage without costly terrestrial infrastructure. ASTS has already secured partnerships with leading telecom providers, including AT&T, Vodafone, and Rakuten, signaling strong industry demand for its services. It is one of the best VLEO stocks on our list.
From an investment standpoint, AST SpaceMobile Inc. (NASDAQ:ASTS) represents a high-risk, high-reward opportunity in the rapidly growing satellite communications sector. During the recent 3Q 2024 earnings call, management issued strong guidance and outlined some ambitious targets to accelerate the company’s growth – the company secured launch agreements with Blue Origin and SpaceX for up to approximately 60 satellites to be launched during 2025 and 2026, enabling continuous space-based cellular broadband service coverage in key markets including the United States, Europe, Japan, and other strategic markets. Financially, the company ended Q3 2024 with $518.9 million in cash, its highest cash balance to date, providing flexibility to pursue strategic objectives. The company ranked second on a recent list of 15 Hot Tech Stocks to Buy Right Now.
Overall, ASTS ranks 2nd on our list of VLEO technology stocks and startups to watch in 2025. While we acknowledge the potential of ASTS as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than ASTS but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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Disclosure: None. This article is originally published at Insider Monkey.