Rocket Lab (RKLB) - Finally a decent space company that we can invest in?

[alcon835]

I get to $100 because I believe Rocket Lab's long-term goal is to be more than just rocket launches, they are working towards supporting "Space" in general, rockets are a part of the overall infrastructure they are developing and supporting. Space is getting bigger and more interesting. NASA and others are working on Moon and Mars missions (and maybe even bases/people?). That could create a lot of support for Space as a sector from the general public. Additionally, with the ability to reliably get into space via Rocket Lab and SpaceX, more companies are going to make the investments. And as things like Starlink becomes more embedded as global internet infrastructure, Space is going to get more and more important politically. And none of this is even taking into consideration the military uses of space.

Rocket Lab will have large rockets in the next few years to go up against SpaceX, additionally their acquisitions make them interesting players in general space infrastructure development and general space support. I think by 2040 they'll not only be one of the top players launching multiple rockets per month across the globe, they'll also be developing infrastructure and providing technological support for all these other pieces of space. "The Amazon of Space" is way too aggressive, but that's where my mind is at. They certainly don't seem content to only provide space ships long term and all their revenue estimates for the next few years assume that launches are going to be the main source of revenue (unless I missed something big).

[Herbert Derp]

Astra just laid off 25% (70) of their employees and shifted another 50 engineers from their rocket program to their satellite engine program:
https://spacenews.com/astra-lays-off-reassigns-employees-as-it-refocuses-on-satellite-propulsion/

Astra doesn’t earn any revenue from satellite engines either. They claim that Rocket 4 will be delayed, but not cancelled. They didn’t give any estimate on how long the delay would be. I can’t imagine that Astra can continue much longer under these circumstances, it looks like bankruptcy is coming any day now.

[Mr Mark]

More garage sale items for Rocketlab perhaps?

[AlanStache]

More garage sale items for Rocketlab perhaps?

Its not nice to refer to engineers that way :-)

[Herbert Derp]

Rocket Lab published their Q2 2023 earnings results yesterday:
https://www.cnbc.com/2023/08/08/rocket-lab-rklb-q2-earnings-report.html

Notably, they signed launch contracts for 10 launches last quarter, including five with returning customer BlackSky. It is great to see Rocket Lab getting all of these contracts, and it is becoming apparent that Rocket Lab has a monopoly on small launch. The other companies who attempted small launch have failed (Virgin Orbit and Astra) and I don’t think anyone else is going to step up to replace them. The cost/benefit/risk of creating an Electron competitor just doesn’t make much sense. This makes Electron the king of the hill!

In the earnings call, Peter Beck mentioned that the next steps for Electron reuse are to first refly an engine and then refly an entire booster. CFO Adam Spice also then went on to mention that the company plans to get the total internal cost of Electron down to $3-3.5M per launch, including recovery and refurbishment of boosters. This would be great for margins, given that Rocket Lab is currently charging customers $7.5M per Electron launch. They also mentioned that Rocket Lab’s factory is currently capable of producing one Electron per week.

On the space systems side, Adam Spice mentioned that Rocket Lab is still on track to achieve 30% non-GAAP gross margins on the SolAero business within the two year post acquisition timeframe that they had originally planned. This is great news to hear, because solar panels are a major source of revenue for Rocket Lab.

On the Neutron side, Rocket Lab continues to make progress with Archimedes, Neutron fuel tanks, and Neutron launch infrastructure, and plans to do a test firing of a complete Archimedes prototype engine by the end of this year. They also mentioned that the acquisition of Virgin Orbit’s facility and tooling will help them to scale up production of Electron and Neutron, especially for rocket engines. That said, it doesn’t seem like the facility is going to help much in terms of R&D.

With all of these steps towards greater margins, we should hopefully see Rocket Lab start to become profitable once Neutron R&D spending comes down, and Neutron starts bringing in revenue of its own. There are exciting times ahead for Rocket Lab!

[Nightwatchman9270]

This dog will be belly up within 3 years.  I call first dibs on the office furniture.

[Radagast]

I have continued buying into RKLB after my initial terrible timing with ill-gotten GME money, because I always heard that you should grasp hard at falling knives and reinforce failure. By now I have something like 250 shares (and growing) at a cost basis around $6.60 per share (and falling).

[maizefolk]

Nice article and including quotes from interview with Rocket Lab's CEO in Ars Technica.

Some new to me information:

Walked back their RTLS-only plan for Neutron which would have limited the rocket to living 8 tons to low earth orbit. They now anticipate a significant fraction of the time Neutron land on a barge downrange (like Falcon 9 often does today) to increase their payload to orbit to 13 tons.

He sounds somewhat less optimistic about a first flight for Neutron in 2024 than I've read in the past: "The schedule says we can get there," he said. "The rubber is going to hit the road in the next six months after we get some of these big tests under our belt. We are certainly going to try to have something on the launch pad in 2024, but you know, it’s a rocket program."

[Herbert Derp]

In other news, SpaceX is expanding its rideshare program to more orbits:
https://spacenews.com/spacex-to-offer-mid-inclination-smallsat-rideshare-launches/

This will likely take business away from Rocket Lab, unfortunately.

[Herbert Derp]

A new interview with Chris Kemp just got posted on Ars Technica:
https://arstechnica.com/space/2023/08/chris-kemp-unplugged-astras-ceo-dishes-on-the-space-companys-struggles/

Chris is ever the optimist, but he seems to admit that Astra is one launch failure away from cancelling their rocket business. That means Rocket 4 needs to work on the first try, which seems almost impossible given Astra’s track record.

At this point, there are two ways for the launch business at Astra to fail. We can either have a launch failure again, or we can fail to launch.

[mistymoney]

Lightning Round: Buying Rocket Lab is like sending money up in smoke, says Jim Cramer(CNBC)

https://www.youtube.com/watch?v=Yt1VXmn_6Eo

thought i'd post it here if any of you all are interested......but seems that cramer isn't interested in startups?

Analyst reports in tdameritrade are pretty favorable.....as a potential investor......where would you go (or do you go?) for the info on rklb? Seems like this would be a pretty good entry point - if in fact they are going to turn around and start posting profits....

[UnleashHell]

Lightning Round: Buying Rocket Lab is like sending money up in smoke, says Jim Cramer(CNBC)

https://www.youtube.com/watch?v=Yt1VXmn_6Eo

thought i'd post it here if any of you all are interested......but seems that cramer isn't interested in startups?

Analyst reports in tdameritrade are pretty favorable.....as a potential investor......where would you go (or do you go?) for the info on rklb? Seems like this would be a pretty good entry point - if in fact they are going to turn around and start posting profits....

Cramer saying don't invest in Rocket labs is the best endorsement for them possible. The mans a fraud and a failure. Rocket Labs looks good now!!

[BicycleB]

Lightning Round: Buying Rocket Lab is like sending money up in smoke, says Jim Cramer(CNBC)

https://www.youtube.com/watch?v=Yt1VXmn_6Eo

thought i'd post it here if any of you all are interested......but seems that cramer isn't interested in startups?

Analyst reports in tdameritrade are pretty favorable.....as a potential investor......where would you go (or do you go?) for the info on rklb? Seems like this would be a pretty good entry point - if in fact they are going to turn around and start posting profits....

Jim Cramer doesn’t bother me. The part I’d view as more important is the question of whether they should be profitable yet.

You said “turn around”. Afaik they’re not a previously profitable mature company that needs to revise its operation and return to profitability. They’re a growth company following the general pattern of spending money to develop and expand, intending to lay the foundation for later profits.

We are getting closer to where the business might pay for its own growth efforts but they didn’t fail in some way by being unprofitable to date. Afaik they they had an ambitious five year plan with targets for performance in technical development and business growth. These implied an arguably reasonable shot at long term profits. Afaik they have, unlike most competitors, mostly hit these targets.

PS. In down markets current profits are popular, in up markets future profits more highly valued. Cramer is more follower than leader. Him disliking RKLB might be more a reflection of the recent market decline than the company’s prospects.

[alcon835]

Lightning Round: Buying Rocket Lab is like sending money up in smoke, says Jim Cramer(CNBC)

https://www.youtube.com/watch?v=Yt1VXmn_6Eo

thought i'd post it here if any of you all are interested......but seems that cramer isn't interested in startups?

Analyst reports in tdameritrade are pretty favorable.....as a potential investor......where would you go (or do you go?) for the info on rklb? Seems like this would be a pretty good entry point - if in fact they are going to turn around and start posting profits....

Jim Cramer doesn’t bother me. The part I’d view as more important is the question of whether they should be profitable yet.

You said “turn around”. Afaik they’re not a previously profitable mature company that needs to revise its operation and return to profitability. They’re a growth company following the general pattern of spending money to develop and expand, intending to lay the foundation for later profits.

We are getting closer to where the business might pay for its own growth efforts but they didn’t fail in some way by being unprofitable to date. Afaik they they had an ambitious five year plan with targets for performance in technical development and business growth. These implied an arguably reasonable shot at long term profits. Afaik they have, unlike most competitors, mostly hit these targets.

PS. In down markets current profits are popular, in up markets future profits more highly valued. Cramer is more follower than leader. Him disliking RKLB might be more a reflection of the recent market decline than the company’s prospects.

I think that last part is the key here, Cramer is only looking at the very short term and is only concerned with what the general market sentiments are, so something like RKLB that isn't expect to post profits for years (but is generating meaningful, growing revenue and has a plan to profitability in the next few years) isn't interesting to him. The long term opportunity is incredible, but the short term opportunity sucks. He wants to tell his followers about something that will make them money in a month, not in 5 years. Not that he actually succeeds in that goal, but that's his schtick.

Also, did you hear his callers? "I bought 2 shares of..." these aren't meaningful investors and they aren't having real conversations about these stocks. I doubt Cramer has even meaningfully looked at most of these stocks. These people aren't reading filings and tracking these organizations over time, they're buying to flip or because Cramer told them to buy.

Additionally, with Cramer (and others, but he is a really good example of this) his money isn't made from investing, it's made from providing an entertaining TV show about investing. It is hard for me to take him seriously.

[mistymoney]

Thanks for the responses. Does seem a bit speculative and that there isn't really hard "evidence" either way - good prespects that may or may not be realized....The ongoing work with NASA is pretty compelling, other side is seems SEC says more insiders selling than buying....

Since it was down quite a bit today, picked up a few shares with pocket change that was jingling around in various account, 192 shares total, so really not much at all. Have a small limit order for 200 more in an IRA rollover account that was getting about 5% on the MM. That may or may not execute today, will see how things goes. I just did a good for today order.....seems the price is popping up rather than to my limit there!

Seems like buying 2000 would be a real "position" for me, and one where if they do succeed as planned, I'd get a real payout for it. But maybe I'm just too cautious - and a token amount may be all I do....

Can I still join the club?

[mistymoney]

well - this was unexpected!

I was keeping an eye on my limit order and did not see the price dip down so I figure it just wasn't meant to be - but I got a partial execution that occurred 4 seconds before market close. My price was 5.61, but looks like close price was 5.65. I'm confused on how these things happen, frankly. Especially for such a low volume order.

So now I have 320 shares. :)

eta: some orders were at 5.62 earlier in the day.....

[BicycleB]

Thanks for the responses. Does seem a bit speculative and that there isn't really hard "evidence" either way - good prespects that may or may not be realized....The ongoing work with NASA is pretty compelling, other side is seems SEC says more insiders selling than buying....

Since it was down quite a bit today, picked up a few shares with pocket change that was jingling around in various account, 192 shares total, so really not much at all. Have a small limit order for 200 more in an IRA rollover account that was getting about 5% on the MM. That may or may not execute today, will see how things goes. I just did a good for today order.....seems the price is popping up rather than to my limit there!

Seems like buying 2000 would be a real "position" for me, and one where if they do succeed as planned, I'd get a real payout for it. But maybe I'm just too cautious - and a token amount may be all I do....

Can I still join the club?

Welcome to the club :)

[Herbert Derp]

Rocket Lab has successfully reflown their first Rutherford engine:
https://arstechnica.com/space/2023/08/rocket-lab-joins-spacex-in-re-flying-a-rocket-engine-to-space/

Next step is apparently to refly nine engines:
https://twitter.com/Peter_J_Beck/status/1694824384689525164?s=46

Here’s a photo of the reused engine:
https://twitter.com/RocketLab/status/1694445669002740176?t=2iYiea0tNBbKKeTM1BP3og&s=19

[time is money]

Tough day. But I guess these things can happen in space industry. Share price down to about 4$ pre-market. Rough month - 50% down from 8$ a month ago.

[alcon835]

Crazy how a company that is consistently launching successfully has one miss and the price drops so much.

[maizefolk]

It's not only that RocketLab had a launch failure, but Firefly* had a successful launch a few days ago. This is technically their second time reaching orbit but the first time they didn't quite make it to the INTENDED orbit.

Firefly is still behind Rocket Lab, but having a third viable looking new-space company putting satellites into orbit starts to weaken the hope launch customers were going to have a vested interest in Rocket Lab's success to avoid a de facto SpaceX monopoly on commercial launch.

*Which I think is only the third new space company to successfully put satellites into orbit.

[Herbert Derp]

Things are looking really dire for Astra:
https://finance.yahoo.com/news/astra-space-exploring-options-including-235119400.html

At the time of posting this, ASTR stock is below $1.00 per share and the market cap is just $18.37M. This is the end of the line. Astra should be joining Virgin Orbit any day now.

*Which I think is only the third new space company to successfully put satellites into orbit.

Fourth. Rocket Lab, Virgin Orbit, Astra, and Firefly have all put satellites into orbit. There’s also the Chinese companies i-Space and Galactic Energy.

[Herbert Derp]

Astra just defaulted on some of their debt:
https://www.cnbc.com/2023/11/03/astra-defaults-on-debt-agreement-may-not-be-able-to-raise-needed-cash.html

The company won’t last much longer. I wonder what they will say on their earnings call in November 13? And which companies are going to buy their assets?

By the way, it’s not even clear if Astra can spin off Apollo Fusion as a separate company. Astra badly bungled the acquisition and almost all of the former Apollo Fusion employees have left the company:
https://techcrunch.com/2023/08/28/astras-apollo-fusion-acquisition-followed-by-delays-and-desertion/

[Must_ache]

Cramer saying don't invest in Rocket labs is the best endorsement for them possible. The mans a fraud and a failure. Rocket Labs looks good now!!

The ETF attempting to short Jim Cramer (SJIM) is down 6.4% since its inception in March.

[MustacheAndaHalf]

Cramer saying don't invest in Rocket labs is the best endorsement for them possible. The mans a fraud and a failure. Rocket Labs looks good now!!

The ETF attempting to short Jim Cramer (SJIM) is down 6.4% since its inception in March.

It's been about 2.5 months since Cramer's comment.  The closest data from Morningstar is 3 month performance, where SJIM beat RKLB by over 40%.

SJIM +6.78%
RKLB -34.42%

https://www.morningstar.com/etfs/bats/sjim/performance
https://www.morningstar.com/stocks/xnas/rklb/trailing-returns

[markbike528CBX]

Next Rocket lab launch:

Electron : QPS-SAR 5 "The Moon God Awakens" LC-1 28 Nov 2023

per:
https://forum.nasaspaceflight.com/index.php?topic=59494.msg2544088#msg2544088

[MustacheAndaHalf]

Customers pay to launch satellites into orbit, which Bryce Tech measures with kg launched into orbit.  This year, SpaceX launched 381,278 kg versus 416 kg for Rocket Lab, a roughly 900x difference.
https://finance.yahoo.com/news/spacex-tender-offer-values-startup-225853647.html
(Source is 2023 Q3 report at [PDF] https://brycetech.com/briefing )

SpaceX is valued at $175 billion in private markets.  If you only looked at kilograms launhed into orbit, that would value Rocket Lab at $200 million.  I doubt SpaceX is 10x undervalued... so is Rocket Lab's $2.2 billion market cap overvalued?
https://twitter.com/elonmusk/status/1732393496428896557
https://finance.yahoo.com/quote/RKLB?p=RKLB

[alcon835]

Customers pay to launch satellites into orbit, which Bryce Tech measures with kg launched into orbit.  This year, SpaceX launched 381,278 kg versus 416 kg for Rocket Lab, a roughly 900x difference.
https://finance.yahoo.com/news/spacex-tender-offer-values-startup-225853647.html
(Source is 2023 Q3 report at [PDF] https://brycetech.com/briefing )

SpaceX is valued at $175 billion in private markets.  If you only looked at kilograms launhed into orbit, that would value Rocket Lab at $200 million.  I doubt SpaceX is 10x undervalued... so is Rocket Lab's $2.2 billion market cap overvalued?
https://twitter.com/elonmusk/status/1732393496428896557
https://finance.yahoo.com/quote/RKLB?p=RKLB

Is Rocket Lab's only source of revenue launches? How many launches do they need in a year to be profitable as a company? What is the state of progress on their large rocket project?

Could the answers to any of these questions contribute to their market cap?

[MustacheAndaHalf]

Good question about Rocket Lab's other sources of revenue.  Their latest quarterly report shows:

Space Systems revenue between $48.5 million to $52.5 million.
Launch Services revenue of approximately $16.5 million.

(I assume it would have been higher if not for the Sept 19 failure)

Your question about profitability assumes there's a direct relationship between number of launches and profitability.  I'm not sure about that.

[BicycleB]

With S&P 500 near record highs (4700+) and RKLB near record lows (under $4.35) today, is RKLB the best relative value it’s ever been?

Its new Electron launch went well. CEO Beck says the problem from last time is solved, but also was tricky because the simple problems have already been solved during the numerous previous launches. Does that mean investors are underestimating the company’s value?

https://spaceflightnow.com/2023/12/14/live-coverage-rocket-labs-prepares-return-to-flight-electron-launch/

Or is the low price correctly reflecting other information? Does Firefly’s progress shift the value proposition? Is there new information suggesting the future profit potential is lower than hoped?

[maizefolk]

It's a bit cheesy but I really enjoyed reading the Ars Technica US launch company power rankinngs this year.

Rocket Lab is up 1 (displacing ULA who only managed to launch three rockets all year, still no Vulcan).
Firefly is up 2 and is probably a better comparator for Rocket Lab to measure themselves against than Astra, which was dropped from the list entirely this year.

https://arstechnica.com/space/2023/12/top-us-launch-companies-of-2023-the-ars-technica-power-ranking/

[shipright]

Well this is some good news. 500M+ contract for multiple vehicles and launch. Even with the afterhours bump I am still slightly underwater, but I am increasingly glad I have been building my position for the last two years.

The rockets are flashy, but what I like seeing is consistent demand for the diversified space services the company offers.

[Herbert Derp]

Damn good news. Yeah, that was a really important contract!!

In recent news, Rocket Lab has returned to flight, which didn’t really have any impact on the stock price because Electron will never be a money maker.
https://www.space.com/rocket-lab-return-to-flight-moon-god-awakens-launch

But what made the stock jump 22.8% today was the news that Rocket Lab landed a $515M contract with the SDA (US Space Force) to build 18 satellites!
https://spacenews.com/rocket-lab-wins-515-million-contract-to-build-18-satellites-for-u-s-government-agency/

This is a bigger and more comprehensive contract than the Globalstar contract, which was $143M for 17 partial satellites.
https://spacenews.com/globalstar-selects-mda-and-rocket-lab-for-new-satellites/

It has been so long since the Globalstar contract that I was beginning to doubt Rocket Lab’s ability to land these important contracts. To put things into perspective, how many Electron launches does it take to equal just this one SDA contract? At $7.5M per launch, it would take 69 Electron launches to equal the $515M SDA contract revenue, which is more than the 41 Electrons that Rocket Lab has launched in Electron’s entire six years of operation! Plus, Electron is break even on profitability, whereas these satellites should have a higher profit margin. So now you see why the market completely ignores Electron.

Satellites are Rocket Lab’s actual business! In other words, Rocket Lab is a satellite (“space systems”) company that also happens to build and launch rockets. At some point, hopefully once Neutron is operational, there should be some sort of synergy between Rocket Lab’s launch and space systems businesses, which in theory should give them an advantage over other companies, especially if they decide to build out their own satellite constellation.

In other news, Firefly Alpha failed again. This makes three failures in four launches, not the best track record! Reminds me of Astra. Space is hard!
https://spacenews.com/firefly-alpha-upper-stage-malfunction-puts-payload-into-wrong-orbit/

[MustacheAndaHalf]

But what made the stock jump 22.8% today was the news that Rocket Lab landed a $515M contract with the SDA (US Space Force) to build 18 satellites.
https://spacenews.com/rocket-lab-wins-515-million-contract-to-build-18-satellites-for-u-s-government-agency/

Did you notice the market priced in a contract for a half billion... by adding a half billion to $RKLB's market cap?  I didn't realize the market took things so literally ...
https://finance.yahoo.com/quote/RKLB?p=RKLB

[markbike528CBX]

Any reason for the RKLB drop yesterday?

Edit ; never mind, I searched and
https://www.fool.com/investing/2024/02/01/why-rocket-lab-stock-cratered-today/

Offering of convertible notes estimated dilution 16%
Preannounced earnings “miss“

Any other theories, preferably involving Taylor Swift and/or the Illuminati?

[Herbert Derp]

Yes, the stock went down because Rocket Lab is raising money and diluting their shares:
https://www.spacedaily.com/m/reports/Rocket_Lab_Launches_275_Million_Convertible_Note_Offering_for_2029_Maturity_999.html

The good news is that these funds should keep Rocket Lab going for about two years or so. Hopefully they will start to be profitable by then!

[talltexan]

I took advantage of the dilution to add shares...U?

[BicycleB]

No.

I couldn’t tell that it added value compared to my expectations. I hadn’t thought enough about dilution from fundraising needs and was caught by surprise; felt sad, couldn’t clearly decide to buy or sell, did nothing.

[Herbert Derp]

I took advantage of the dilution to add shares...U?

I didn’t buy any shares, since I already have quite a few as it stands.

[Herbert Derp]

Listened to the latest investor call:
https://investors.rocketlabusa.com/events-and-presentations/events/event-details/2024/Fourth-Quarter-2023-Financial-Results-Update-and-Conference-Call/default.aspx

Things are really starting to come together! I am excited about the future of this company!

A few takeaways:

* 22 Electron missions are booked for 2024. Contracts for 25 Electron launches (18 Electron, 7 HASTE) were signed in 2023. This is higher than the 16 launches per year that Rocket Lab says is necessary for Electron to be profitable. This is also much higher than the 10 Electron launches in 2023 which was still a record.

* The next step for Electron reuse is to launch an Electron with all 9 engines being reused from a previous flight. Also, the latest recovered Electron booster is in such good shape that Rocket Lab is evaluating whether it can be reflown entirely.

* With the help of the SDA space systems contract, Rocket Lab’s order backlog has topped $1B!

* The first reaction wheels for Rocket Lab’s mysterious megaconstellation customer should ship this year. This is a really big contract, and I strongly suspect it is for Amazon’s Project Kuiper.

* Rocket Lab is still on track to have a completed Neutron on the pad in December 2024, if “everything goes right.” It’s safe to say that everything won’t go right, so expect to see Neutron on the pad sometime in the first half of 2025.

* Total R&D spend for the Neutron program is estimated to be around $300M. This is on track for what Rocket Lab planned to spend at the start of the program.

* The first Archimedes is getting closer to completion, first engine should be on the test stand in April or May.

* Neutron launch pad is under construction. Canards and other subsystems are also well into development. A factory with automated fiber laying machine is being built in Maryland. Expect to see more completed parts of the Neutron rocket such as fairings, interstage, and tanks by Q2 2024.

* Rocket Lab has expanded their portfolio of spacecraft busses to four distinct products: Photon (the original), Lightning (larger, 12+ year lifespan spacecraft bus developed for MDA/Globalstar), Pioneer (more mobile “medium delta-V” Photon variant), and Explorer (deep space Photon variant).

* The reason for the capital raise and dilution is that Rocket Lab is getting ready to acquire another company! Rocket Lab made this crystal clear during the conference call, and said they already had enough cash to complete Neutron before the capital raise.

* Rocket Lab has reiterated that their ultimate goal is to build, launch, own, and operate their own satellite constellation for Space Services. Everything they are doing, in terms of building out satellite manufacturing, satellite operations, and launch capability is directed towards this ultimate goal. They have not revealed what type of constellation they want to build, and are focused on completing Neutron right now.

* Spending will peak this year, and cool down once Neutron is on the pad in early 2025. Once that happens, Rocket Lab should become a profitable company!

CNBC’s coverage here:
https://www.cnbc.com/2024/02/27/rocket-lab-rklb-q4-2023-results.html

[Herbert Derp]

If anyone was thinking of investing in Rocket Lab, now could be a great time. The company is nearing a very important inflection point. Over the next 12-18 months, the following should happen:

1. Neutron should be complete, R&D spending will decrease, and Rocket Lab should become profitable.

2. Rocket Lab should sign some big contracts for Neutron launches, significantly boosting their order backlog. As of yet, there is not a single Neutron launch contract, because Rocket Lab refuses to sign any contracts before the rocket is ready. They don’t want to make concessions on the value of the contracts due to signing a contract without a functional rocket.

3. Rocket Lab should acquire one or more companies, increasing their vertical integration and growing the company even more.

4. Rocket Lab should finally reuse an Electron, further boosting the profitability of the Electron program.

Looking forward to the next 30 months, once Neutron is operational, we can expect that Rocket Lab will announce their own Space Services constellation and start putting up satellites. All the pieces are coming together to make this plan a reality, and when it happens, it will be huge. Unlike almost every other space company, Rocket Lab will be completely vertically integrated in terms of building, launching, and operating their satellites. This will make them highly competitive compared to other space services companies, many of which aren’t building their own satellites and rely on other companies to launch them. This is still a bit in the future, but I see all the pieces of the puzzle coming together in the next 18 months to make this dream a reality within the next 30 months.

Once the above happens, my opinion is that investors are really going to start waking up to see that Rocket Lab is a serious and successful space company, and the stock price should go up significantly.

Remember that Rocket Lab has a market cap of $2.29B and SpaceX has a valuation of $180B! That’s 80 times higher than Rocket Lab! Rocket Lab is making great strides to replicate SpaceX’s business model, more than almost any other company besides Blue Origin. If Rocket Lab can become worth just 1/10th of SpaceX, that represents an 8x increase from their current market cap.

What do you guys think?

[alcon835]

You started this thread in 2021 and it was right around that time I started investing into Rocket Lab...well the entity that would become rocket lab anyway.

At the time, I always considered this a 10+ year investment and as such I've been putting more money into Rocket Lab every month since 2021. All in, I'm down 14% on my investments into Rocket Lab.

And yet, I didn't plan on a 3-year investment, I planned on a 10 year investment. I bought in to the idea that this was a company that would develop and grow and that the prices I was (am) buying into would be the envy of my future self 10 years from now. And I still think that is the case. They are on a clear road to profitability when that is the number one driver of value. Based on their previous acquisitions, I fully trust them to purchase an organization that bolsters them even higher. They have all the right contracts in place and are on the cusp of a rocket that will compete effectively with SpaceX. They also own their own launch pads, they are building their own constellation of satellites, they are getting government contracts...everything I needed them to be doing 3 years from my first investment they are doing - and at a fantastic pace. If anything, they seem ahead of where I expected them to be at this time. They could be blowing it out of the water in another 2-3 years!

If anything I am more bullish on Rocket Lab than I was in 2021 and while I would love for their overall valuation to be higher, I am very happy with how they are setting themselves up for success long term. My hope is by the end of 2025 they are a $20/share company. My hope is by 2031, they are a $100/share company.

[BicycleB]

What do you guys think?

I’m not as confident as you are, partly because:
1. I still have trouble getting a clear idea of likely market size
2. SpaceX’s successes are intimidating in that I suspect SpaceX has more ability to compete diectly with RKLB at some point than is usually imagined in this thread
3. Even so, SpaceX could easily be overvalued. The “compared to SpaceX” method may have a rickety overhyped base.

That said, I am encouraged by recent info:
4. Your remark that the dilution is for acquisition. I’d been thinking it was to complete existing plans, so I’d cautiously begun marking down my expected future value. I will stop that for now.
5. The general flow of news does suggest the company is achieving its goals on time, implying that its odds of achieving its mid-2020s goals have risen since my first purchases in the SPAC era.
6. Recent prices of $5.xx/share made me hesitate, but today’s price is a satisfyingly low $4.57/share.

So, overall:

7. With a low price compared to the starting point and especially compared to the rising overall market, this continues to be the best buying opportunity we’ve had.
8. The higher likelihood of success is shifting this from “fun game” to “has risks, but good enough to expand my stake”.
9. Today I’m selling other another security to free up cash for more RKLB. Let’s hope prices stay low for a few more days. :)

[vand]

RKLB has done nothing but burn through investors money faster than rocket fuel since flotation, but I guess we all have our vices.

[alcon835]

Here's a fun exercise I'll do over the weekend, how do their original financial predictions hold up?

https://s28.q4cdn.com/737637457/files/doc_presentations/2021/07/Rocket_Lab_-_Investor_Day_Slide_Deck.pdf

At a high level, they estimated to be at $267M in revenue in 2023 and they hit $244M. There's a $20M gap in there, but that seems extremely easy to overcome, especially since they had a few small hiccups this year.

Seriously, they are right on track and growing quickly year-over-year.

[Herbert Derp]

Here's a fun exercise I'll do over the weekend, how do their original financial predictions hold up?

https://s28.q4cdn.com/737637457/files/doc_presentations/2021/07/Rocket_Lab_-_Investor_Day_Slide_Deck.pdf

At a high level, they estimated to be at $267M in revenue in 2023 and they hit $244M. There's a $20M gap in there, but that seems extremely easy to overcome, especially since they had a few small hiccups this year.

Seriously, they are right on track and growing quickly year-over-year.

They would have hit the revenue target if they didn’t have the launch failure and had the number of launches which was originally scheduled for 2023.

[Herbert Derp]

RKLB has done nothing but burn through investors money faster than rocket fuel since flotation, but I guess we all have our vices.

Do you have a more specific reason why you think Rocket Lab is a bad investment? I welcome opposing viewpoints, but to say Rocket Lab is bad because they spent a lot of money is not a good argument. Many very successful companies burned money in their first decade. By all measures, Rocket Lab is very capital efficient when you compare them to their peers.

[BicycleB]

RKLB has done nothing but burn through investors money faster than rocket fuel since flotation, but I guess we all have our vices.

Building reusable rockets and developing a workable space services business is “nothing”?

Um, startup companies spend money. It’s part of the business life cycle.

What would you call “something” in this context?

Are there any startup companies you respect, or do you think a society should stop building new businesses?

[BicycleB]

9. Today I’m selling other another security to free up cash for more RKLB. Let’s hope prices stay low for a few more days. :)

Got lazy, waited too long - and got lucky; at $4.37, today's price is better than two weeks ago, while the S&P rose to record highs.

Loaded up today, more than doubling my stake. Now about 3% of investable assets.

[LightStache]

9. Today I’m selling other another security to free up cash for more RKLB. Let’s hope prices stay low for a few more days. :)

Got lazy, waited too long - and got lucky; at $4.37, today's price is better than two weeks ago, while the S&P rose to record highs.

Loaded up today, more than doubling my stake. Now about 3% of investable assets.

Just curious what everyone's initial and on-going portfolio % limits are for a stock like this? My limit for buying individual speculative stocks is 5% of NW (my NW is lower than my investible assets due to debt). I have no on-going upper limit that would cause me to sell before reaching my target price.