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Stockchase Insights
Rocket Lab USA
RKLB-Q
PARTIAL BUY
May 09, 2025
Stock price when the opinion was issued
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Rocket Lab USA, Inc., a space company, provides launch services and space systems solutions for the space and defense industries. The company provides launch services, spacecraft engineering and design services, spacecraft components, spacecraft manufacturing, and other spacecraft and on-orbit management solutions; and constellation management services, as well as designs and manufactures small and medium-class rockets. It also designs, manufactures, and sells Electron small orbital launch vehicles and the Photon satellite platforms, as well as developing the Neutron 8-ton payload class launch vehicle; conducts remote launch activities; and designs and manufactures a range of components and subsystems for the Photon family of spacecraft and broader merchant spacecraft components. The company serves commercial, aerospace prime contractors, and government customers. The company was founded in 2006 and is headquartered in Long Beach, California. Social media mentions are up 257% in the past 24h.
Well positioned for explosion in commercial space activity as launch costs come down. Launch business will have a new product later this year, a direct competitor for the mid-range Falcon 9 from SpaceX. The other 2/3 of their business involves space systems, which is building satellites for customers. No dividend.
Really likes the scrappy, technical, and resourceful CEO. Reminds him of Elon Musk in the early days.
RKLB had a decent quarter, is getting some stock mojo back after its prior weak quarter (and short attack) and has signed some decent new contracts. It is still an 'expensive' stock in a still-uncertain environment. Cash flow remains highly negative and losses are expected to continue for at least two years. We like the company...less so the valuation. We would be OK with a starter position (1/4 size, perhaps) for very aggressive investors.
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