Key Takeaways
- Stifel reiterated its Buy rating and $132 price target on Rocket Lab on Nov. 10. That’s 110% above the stock’s Nov. 10 close, which sits 58% below its May high.
- Third-quarter revenue rose 73% to a record $268 million, but Neutron’s first launch has slipped into 2027 with no date set.
- Getting to $132 would take close to the highest forward sales multiple Rocket Lab has carried at a quarter’s end. And if its shares average $67.50 or less in the run-up to the Iridium Communications deal’s close, the deal pays out the most stock it allows.
- The selloff may have gone too far, but $132 is a price for Neutron flying on schedule, and a first-launch date is the next test.
Rocket Lab (RKLB) sits 58% below its May high, and Stifel thinks the selloff went too far. On Nov. 10, Stifel analyst Erik Rasmussen reiterated his Buy rating and $132 price target, 110% above that day’s $62.71 close. The shares finished up more than 6% that day after trading lower before the open on a wider-than-expected quarterly loss.
A big deal, then a late rocket
A month after its May 27 peak, Rocket Lab agreed to buy Iridium Communications (IRDM) for about $8.0 billion of enterprise value. It raised the cash by selling stock: about $2.4 billion of it in the third quarter, CFO Adam Spice said. Its weighted share count hit 652 million that quarter, up from 529 million a year earlier. On Oct. 14, Rocket Lab pushed Neutron’s first launch into 2027 after finding voids in a first-stage tank dome, a setback that followed a tank rupture in testing in January. The Nov. 9 report brought record revenue of $268 million, up 73%, and a $3.57 billion backlog, but no launch date.
Stifel is betting on Electron and Neutron
Stifel raised its target to $132 from $110 in early June, pointing to strong execution across launch and space systems and calling Neutron the key driver of long-term value. It reiterated the target on Oct. 15, the day after the delay. The quarter backed up the demand: over $515 million of new Neutron contracts, several at a $70 million base price, and 16 missions booked ahead of its debut.
TIKR tracks 22 analysts on Rocket Lab. How many say “Buy”?
See the full breakdown of Buy, Hold, and Sell ratings on Rocket Lab, along with Wall Street’s revenue and earnings estimates, all in one place. More than 500,000 investors use TIKR to research stocks like this one. See Rocket Lab’s Analyst Ratings
Can Rocket Lab get back to $132?
Stifel’s target sits 29% above the $102 consensus, which has climbed from about $60 a year ago but is down from about $117 in July. In TIKR’s Nov. 9 data, 22 analysts covered the stock, with targets from $64 to $150. Several firms moved lower after the report: Piper Sandler cut its target to $58 from $83, and Roth, Craig-Hallum, Cantor Fitzgerald and Barclays trimmed theirs, while Clear Street raised its target to $110.
Earnings estimates have gone the other way: analysts expect Rocket Lab’s first normalized profit in 2027, at 4 cents a share.
That estimate was 16 cents a year ago. With Neutron spending set to rise in the fourth quarter, this report gives little reason to expect a quick turn.
So the stock trades on sales. In TIKR’s figures, Rocket Lab’s five-year average forward sales multiple is about 23x, and its peak at any quarter’s end was about 62x, last seen in June. On the $1.33 billion 2027 revenue consensus, $132 works out to roughly 60x to 65x sales, depending on the share count used, right around that peak.
Wait for a launch date
The risk is the share count. If Rocket Lab’s stock averages $67.50 or less over the 10 trading days before the Iridium deal closes, targeted for mid-2027, Iridium holders get the most stock the deal allows. Demand is strong, and Rocket Lab holds about $4.7 billion of cash and securities, though much of it was raised to fund the deal’s $27-a-share cash payment. The selloff may well have gone too far. But $132 is a price for Neutron flying on schedule and a near-peak multiple, and Rocket Lab hasn’t named a launch date. Until it does, the path to Stifel’s target looks narrow. A firm date is the next test, since management has tied its path to profitability to Neutron’s first successful flight.
So what is Rocket Lab stock actually worth?
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Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any of the stocks mentioned. Thank you for reading, and happy investing!
