BofA is expecting a $200 billion satellite boom, how can investors capitalize on it?

Bank of America sees a $200 billion potential in the low-Earth orbit satellite market and names three projects as favorites, including Elon Musk's Starlink. U.S. telecom operators such as AT&T and Verizon already see satellite services as a way to close "dead zones" and increase revenues through new tariffs and subscriptions.

The market of satellites in low earth orbit (LEO) is at an early stage of development, but, according to Bank of America (BofA), it opens up huge prospects primarily for manufacturing companies. The bank's analysts name three projects among the favorites: special attention is paid to AST SpaceMobile, whose shares are traded on the stock exchange. In addition, BofA highlights Elon Musk's Starlink and Jeff Bezos' Project Kuiper, MarketWatch reports.

Low Earth orbit is an altitude of up to 1,200 miles (about 1,900 kilometers). This is where the commercial satellite industry is actively developing. According to BofA calculations, the Total Addressable Market (Total Addressable Market) of the LEO segment may reach $200 billion, of which about $80 billion is accounted for wireless communications, broadband Internet and defense projects.

American telecom operators, such as AT&T and Verizon, will be able to use satellite services to cover "dead zones". This will allow them to increase average revenue per subscriber through per-minute tariffs or subscriptions to satellite services, says BofA analyst Michael Funk.

AST SpaceMobile is a US company building a satellite network to deliver mobile broadband internet directly to smartphones without additional hardware. As BofA notes, it is this company that gives investors the opportunity to invest directly in the LEO trend, as its shares are traded on the stock exchange.

Today AST has six satellites in orbit, but a major expansion is planned in the coming years. An important advantage is cooperation with about 50 mobile operators. BofA considers the regions of the western United States, where 5G coverage is not yet available, to be particularly promising.

In August, the company confirmed a "fully funded" plan to launch 45-60 satellites by the end of 2026. This will provide space-based cellular broadband in the US, Europe, Japan, and for the US government.

AST SpaceMobile shares are up more than 380% over the past three years, significantly outperforming the S&P 500 index (+70%), MarketWatch notes.

Starlink is a project of Elon Musk's SpaceX company, which aims to create a global satellite Internet network. Today it is the world's largest satellite constellation. According to astrophysicist Jonathan McDowell, as of September 15, there were 8405 Starlink satellites in orbit, of which 8390 are operational. At the same time, 650 satellites are part of the key constellation needed to enter the $200 billion LEO market, MarketWatch emphasizes.

Satellites are interconnected and transmit the signal to ground stations and user terminals. This makes the Internet available even in the most remote areas without traditional infrastructure.

Starlink shares are not traded on the stock exchange, as SpaceX remains a private company. Because of the large-scale investments in the launch of satellites in the company notes that the IPO Starlink is possible only after achieving financial stability and stable profitability. This may take several more years, Bullish Bears specifies .

Project Kuiper is a project within Jeff Bezos' Amazon business. To date, the company has put more than 100 satellites into orbit, but plans to expand the constellation to 3,236 vehicles. The full-scale launch of the project is scheduled for 2026, MarketWatch adds.

Amazon's stock is publicly traded, but Project Kuiper is not separately listed in public trading.

This article was AI-translated and verified by a human editor