Jason Luongo
Growth-Stock Options Trader, LEAPS & Income Strategies
Rocket Lab's 58% drop from its high on the Iridium deal financing is the entry for a five-year hold. The $8B Iridium acquisition adds a 66-satellite constellation with over $870M of annual revenue, turning a launch company into an end-to-end space business. Revenue grew 62% to $234M last quarter, backlog rose 137% to $2.36B with a record 90+ launches booked, Electron is 13 for 13 this year, and Neutron is targeted for the pad in Q4. x.comÂ
Rocket Lab is worth owning at a better price, and selling cash-secured puts gets paid to wait for one. Electron has 50+ launches and is the only operational Western small-launch vehicle, Neutron targets a first flight in late 2026, and Rocket Lab holds an $816M Space Force contract to build 18 missile-tracking satellites and a $190M HASTE hypersonics deal, with backlog up 73% year on year to $1.85B. x.comÂ
Rocket Lab's growing Space Systems business positions it to provide more than launches for the space economy. It generated $189.5M in Q2, 81% of revenue; if its pending Iridium acquisition closes, it would gain a global satellite communications network. At about $51, this is one of the most compelling long-term opportunities in the space sector over 3-5 years, provided it keeps executing. Neutron's launch has slipped to 2027, and execution risks remain. x.com x.com x.comÂ
Rocket Lab's record Q2 and Iridium deal show it becoming an end-to-end space and defense platform that can capture more value than a launch-only company. Q2 revenue hit a record $234M, up 62%, and backlog a record $2.36B after over $1B of new contracts. Iridium adds over $870M of annual L-band revenue tied to government and enterprise. Launch revenue fell 30% sequentially largely because more HASTE defense work is recognized over time; Mynaric integration weighs on near-term margins. x.comÂ
Rocket Lab still looks ridiculously expensive at 29 times forward sales against SpaceX at 22 times, even after a 65% fall. At 22 times, Rocket Lab would be roughly $38, and SpaceX would still be the pick. SpaceX also has better forward guidance; Rocket Lab's negative adjusted EBITDA makes sales multiples the valuation yardstick. x.com x.com x.com x.comÂ
Rocket Lab's expanding contracted work improves medium- and long-term revenue visibility. Synspective added 20 dedicated Electron launches for 2028-31, bringing its total to 47; backlog reached $2.4 billion after more than $1 billion in Q2 and early-Q3 awards. Space Systems broadens the business beyond launches, while Neutron's medium-lift upside still depends on reaching operational orbit. x.comÂ
Rocket Lab is underestimated as a launch company when it is building a broader space infrastructure business, where satellites, components, spacecraft systems and national-security demand could matter as much as launches. It just signed its largest commercial Electron deal by mission count, 20 launches for Synspective from 2028 to 2031, per Wall St Engine, pushing its launch backlog above 100 missions. x.comÂ
Rocket Lab's deal to buy Iridium partly with its own stock confirms the stock is worth very little. Per @junkbondinvest, Rocket Lab is paying $8 billion in enterprise value, $54 a share, half in cash and half in Rocket Lab stock. Using an overvalued currency to buy something with real value is accretive and minimizes the loss for shareholders, following the playbook of SPCX buying Cursor. x.com x.comÂ
Rocket Lab is becoming a vertically integrated space enterprise, putting it in a different league from AST SpaceMobile. It is one of only two companies that can routinely launch to orbit, and Electron's backlog is booming after its largest commercial contract ever, 20 launches for Synspective, bringing that customer to 47. Neutron is likely in early 2027. At about twice AST's market cap, that gap should keep growing over the years even if both succeed. x.com x.com x.comÂ
Rocket Lab's after-hours selloff on a record quarter is a buying opportunity because it is becoming a space prime, one of only two full-stack space companies alongside SpaceX. Revenue hit a record $234M, up 62%, backlog a record $2.36B, up 137%, with more than $1B of Q3 contracts signed and $2.4B of cash. On VICTUS HAZE it launched in 16h42m against a 24-hour window. CEO Peter Beck said Neutron delay coverage is exaggerated. Rating stays Overweight with a $130 target. x.com x.com x.comÂ
Rocket Lab's vertical integration is structurally diluting the margins that made it special. Q3 GAAP gross margin is guided to 29-31% from 36.1%, and purchase accounting from Mynaric and Motiv explains at most a third of the drop. Per management, components earn over 70% margins while satellite platforms run in the mid-30s, and the growth is in platforms. Neutron sells full-price $50-55M slots but has never flown, so its value as a second launch source remains unrealized. x.comÂ
Rocket Lab's defense contracts and backlog position it to benefit from national-security spending. Its $2.36B backlog includes over 100 booked launches, with an $816M SDA satellite deal and a $266M Space Force HASTE deal for hypersonic testing. Despite the Neutron delay, its $36B valuation offers one of the space sector's best risk-reward setups: exposure to the same defense and space-infrastructure trend as SpaceX at a fraction of its valuation. Rocket Lab is headed above $100. x.comÂ
