Space launch provider Rocket Lab USA (RKLB -6.68%) reported mixed fourth-quarter earnings on Thursday, Feb. 27. Revenue in Q4 was notably higher at $132.4 million, topping analysts' consensus projections of $130 million and rising 121% year over year.
The commercial space company reported solid fourth-quarter numbers.
Rocket Lab USA, Inc. (NASDAQ:RKLB ) Q4 2024 Earnings Conference Call February 27, 2025 5:00 PM ET Company Participants Murielle Baker - Senior Communications Manager Peter Beck - Founder and CEO Adam Spice - CFO Conference Call Participants Edison Yu - Deutsche Bank Andres Sheppard - Cantor Fitzgerald Suji Desilva - ROTH Capital Trevor Walsh - Citizens JMP Michael Leshock - KeyBanc Capital Markets Jason Gursky - Citi Erik Rasmussen - Stifel Andre Madrid - BTIG Operator Good evening and thank you for standing by. My name is Kelvin and I'll be your conference operator today.
Rocket Lab USA, Inc. (RKLB) came out with a quarterly loss of $0.10 per share versus the Zacks Consensus Estimate of a loss of $0.09. This compares to loss of $0.10 per share a year ago.
Rocket Lab USA Inc. shares fell more than 14% in extended trading Thursday after the space-launch company topped Wall Street's fourth-quarter revenue estimates but gave a weaker-than-expected first-quarter outlook.
Rocket Lab is actively expanding its activities, developing sales of space components, creating satellite platforms, and providing orbital support services to cover the entire cycle "from rocket to satellite". If Neutron's debut is successful, annual revenue could grow dramatically, although the project itself carries some technological risks. The company is very expensive in terms of multipliers, which may indicate that investors expect a great future from Rocket Lab.
Investors interested in RKLB stock should refrain from adding this stock to their portfolio before Thursday, considering its premium valuation.
Rocket Lab USA, Inc. is a promising venture, but the current high valuation poses risks; recommend holding until stock price drops to $16-17/share. Despite impressive growth and expansion in the space industry, Rocket Lab's market cap already matches its future serviceable market size, raising concerns. Competition with SpaceX and moderate margin improvements suggest Rocket Lab may struggle to dominate the medium-lift market and achieve desired profitability.
High-flying Rocket Lab (RKLB -9.60%) stock tumbled down (almost) to Earth Tuesday after Bleecker Street Research -- which publishes "public short ideas" for its parent company, stock-shorting firm Bleecker Street Capital -- warned that Rocket Lab's highly anticipated Neutron medium-lift vehicle won't launch for "a long, long time." As of 1:15 p.m.
Last year was a record for Rocket Lab USA (RKLB -6.77%), with significant milestones and achievements in the aerospace industry.
Rocket Lab's Q3 2024 revenue grew 55% YoY, but the current price of $28.30 appears unsustainable given mounting losses. My valuation analysis suggests a fair value range of $16.20-$18.80, indicating a 62% premium to midpoint value. While gross margins improved to 26.7%, widening operating losses of $51.9M raise concerns.
Rocket Lab USA, Inc. stock has more than doubled since my early November 2024 bullish call, outperforming the broader market's modest gains. RKLB's strong financial performance, particularly in Space Systems, and promising future projects like Neutron, support my bullish long-term outlook. Despite increased operating expenses, the top line growth justifies the costs, with expectations of breaking even by FY 2026 and significant future profitability.