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Rocket Lab USA Positioned for Launch Demand


Analyst firm Stifel recognizes that space company Rocket Lab USA Inc. is in a prime position to capitalize on the increasing demand for launches. According to Stifel analyst Erik Rasmussen, Rocket Lab is deemed as one of the highest-quality space companies in the market. Rasmussen commends Rocket Lab’s dedicated small launch rocket, Electron, as a game changer that will drive the industry forward. Furthermore, he expects Rocket Lab’s medium launch rocket, Neutron, to contribute significantly to the deployment of smallsat constellations.

Rocket Lab is making significant progress towards its Electron rocket-launch target for 2023, with the company already more than halfway there. During a recent conference call discussing the company’s second-quarter results, CEO Peter Beck revealed that Rocket Lab is approaching its 40th Electron rocket launch. The company remains on track to complete three more launches this quarter and a total of 15 launches this year. Rocket Lab emphasizes that its 59-foot-high Electron rocket is the only reusable orbital-class small rocket available.

The demand for launch services remains high, and the company’s launch schedule is already filling up until 2024 and 2025. Additionally, once the MDA/Globalstar program enters production, it will further benefit the space systems industry. Last year, Rocket Lab secured a $143 million subcontract from Canadian space company MDA Ltd. to design and manufacture 17 spacecraft buses for Globalstar’s Low Earth Orbit satellites.

Stifel maintains its buy rating for Rocket Lab, and according to FactSet survey data, seven out of nine analysts hold an overweight or buy rating for the company, while two analysts have a hold rating.

In terms of stock performance, Rocket Lab experienced a slight decline of 0.8% on Wednesday, while the S&P 500 recorded a decline of 0.3%. However, Rocket Lab shares have gained an impressive 75.2% in 2023, surpassing the S&P 500’s gain of 16.8%.

To continue its ambitious plans for regular missions and the development of new spacecraft, Virgin Galactic recognizes the need for secure capitalization. Analysts affirm that capital is key for the company’s future success.

Rocket Lab’s Neutron Rocket Poised for Success

Rocket Lab, a prominent venture-capital and advisory company specializing in space investments, is set to make significant headway with its forthcoming Neutron rocket. Expected to revolutionize the commercial launch market, the Neutron rocket’s price tag of $50 million is a game changer compared to last year’s launches in the $8 million range, according to CEO Justus Parmar.

Standing at an impressive height of 141 feet, the Neutron rocket is specifically designed to deploy mega constellations of satellites, facilitate deep-space missions, and even support human spaceflight. Rocket Lab CEO, Peter Beck, recently shared during the second-quarter results conference call that steady progress is being made towards a planned launch of the Neutron rocket by the end of 2024.

To further strengthen its capabilities, Rocket Lab acquired Virgin Orbit Holdings Inc.’s aerospace production and manufacturing facility in Long Beach, California earlier this year for $16.1 million. This purchase agreement not only secured a state-of-the-art manufacturing facility but also included the sale of important launch vehicle production machinery and equipment. As Michael Rasmussen noted, this strategic move will lead to reduced capital expenditure for the Neutron rocket, as Rocket Lab gained the assets through an auction process at a significantly lower price than prevailing market value.

The success of Rocket Lab is not only advantageous for the company itself but also serves as welcome competition for SpaceX. Parmar believes that as Rocket Lab continues to establish itself as a leader in commercial launches, it presents a compelling alternative to SpaceX’s dominant position in the industry. With SpaceX accounting for over 80% of U.S. and 69% of global launches, this competition is crucial for fostering a healthy space industry and ensuring Elon Musk’s company does not dominate the market.

In summary, Rocket Lab’s Neutron rocket is expected to bring about tremendous growth and opportunity for the company while providing healthy competition within the commercial launch market. With a strong focus on innovation and a strategic acquisition, Rocket Lab is well-positioned to challenge the monopoly held by SpaceX and contribute to the flourishing space industry.

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