Rocket Lab USA’s stock has seen a remarkable increase of nearly 470% over the past year, driven by its successful Electron rocket launches, new contracts, and the anticipated rollout of its larger Neutron rocket. Despite the substantial rally, some investors may still consider it a good time to buy before the upcoming earnings report in August, due to several compelling factors.
Firstly, Rocket Lab’s core business continues to grow. Its Electron rocket has achieved 66 successful launches, deploying 227 satellites and maintaining significant contracts with major clients, including NASA and the U.S. Space Force. Revenues skyrocketed over seven times from $62 million in 2021 to $436 million in 2024, showcasing a robust growth trajectory.
Secondly, the Neutron rocket, which boasts a higher capacity for payloads of up to 13,000 kilograms, is set to debut in the second half of 2025. This rocket has already secured contracts from NASA and a prominent satellite operator. While it will face more competition—particularly from SpaceX’s Falcon 9—shifts in government procurement could favor Rocket Lab amid challenges facing its competitor.
Additionally, the company’s adjusted EBITDA margins have improved significantly, moving from negative 70% in 2021 to negative 22% in 2024, thanks to increased launch volume and tighter operational expenditures.
Rocket Lab remains active in expanding its portfolio through various contracts and partnerships. Recent endeavors include launching research satellites for NASA, securing opportunities for NASA’s next Mars mission, and agreeing to a constellation of satellites for Kinéis. The company also plans mutual efforts with Kratos Defense to advance hypersonic technologies and is acquiring Mynaric and Geost to enhance its capabilities in laser communications and military satellite sensors.
Lastly, analysts predict that Rocket Lab’s revenue could nearly triple from 2024 to 2027, growing from $436 million to approximately $1.2 billion. Expectations for adjusted EBITDA profits by 2026 also support a long-term positive outlook, suggesting the company may be undervalued at its current enterprise value relative to its growth potential.
Despite Rocket Lab not making a recent top stock recommendation list, its ongoing expansion and improvements position it as a potentially promising investment for those willing to look past the recent stock surge. Investors considering a stake may find it worthwhile to take advantage of Rocket Lab’s growth prospects before its next earnings report delivers further insights.
Overall, Rocket Lab’s future looks bright as it continues to innovate and secure significant government and commercial contracts, which could help it solidify a more significant share of a rapidly evolving space industry.