Dear fellow speculators,
this is my first DD here so let’s see if I do this correctly. This in not a fundamental play, instead a play of a single event which could push the stock to the moon, or cut it in half. So this is a very risky play, just buy what you can afford to loose. Therefore I can’t give you financial advice.
I’m watching $ASTR since a few months now.
It’s a space company which produces light weight aluminum rockets. The idea is, that these rockets don’t need too much space and could almost start from everywhere. This could be a cheap way to bring your payloads effectively into space. If you want to know more, just look at their website, I always recommend to check this stuff yourself.
In comparison to other space company’s the company is small and like every other ones in this business the stock is very volatile. While it had an 52-week high at USD 22,47 the shares trade at a price which is below the pre spac amount.
When looking at the chart you can clearly see a pattern when the stock runs: The company is still testing their rockets and before every launch the stock price rises in hope of a breakthrough.
The last launch went terribly wrong and the rocket LV0006 crashed after a few minutes. The stock fell to all time lows at USD 7,34. It stayed for some time in this region until the company published some news: They found the source for the crash and are launching a new fixed version of their rocket now called LV0007.
The launch is planned to be October 27-31 or November 5-12.
The stock did already run because of this, so this entry point is over.
But I expect the stock to consolidate at this price range about USD 9,20-9,60 and there may come a sell the news event or a bigger sell of, if the first launch window can’t be held. That’s when to buy in.
If the rocket launch succeeds, and there’s a big chance it will, the stock will rise to the same highs it has seen before the last failed launch. This will be at least about USD 11-12, so right now without a sell off there’s a chance of a 26% increase for stocks alone, when the stock drops in the scenarios mentioned above it’ll be more. I don’t play options, so I can’t give you any hints on these.
On the other hand: If the launch failes, the stock could drop really hard and see a new rock bottom. The next launch then is not scheduled before February.
So what to do? Check the website and think about arguments for the cause of the last failed launch. If you find them reasonable and are willing to risk your investment wait for a good entry point. I expect the price will fall a bit soon before the launch, when people get scared that the next launch will fail too and therefore sell beforehand. If the rocket launch succeeds take profit or even hold some shares, because this means the company made a breakthrough and will be able to accelerate their growth. It’s hard to tell when, but the stock could rise a few days before the new launch window next week too. It’s all a matter of days now.
Good luck!
My position: 110 Stocks @8.83
Thanks for this DD
