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3 Top Space Stocks to Buy in November

Updated: 09-11-2024, 12.54 PM

Over the past three years, many space-focused start-ups went public by merging with special purpose acquisition companies (SPACs). Some of those stocks initially soared, but most of them fizzled out as rising interest rates highlighted their ugly losses and popped their bubbly valuations.

Many of those SPAC-backed space companies also set overly ambitious growth targets, missed them by a mile, and struggled with severe delays and management issues. However, a handful of resilient companies survived that industrywide wash-out.

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Let’s see why three of those survivors — Rocket Lab USA (NASDAQ: RKLB), Intuitive Machines (NASDAQ: LUNR), and AST SpaceMobile (NASDAQ: ASTS) — are still worth buying right now.

A child stands in front of space-based illustrations on a glass screen weaing what looks like a space helmet.
Image source: Getty Images.

Rocket Lab produces partly reusable rockets for the National Aeronautics and Space Administration (NASA), the U.S. Space Force, the Swedish National Space Agency, Capella Space, and other big customers. Its main product, the Electron orbital rocket, can carry payloads of about 300 kilograms (around 660 pounds).

The Electron has been successfully launched 53 times over the past seven years. Its next rocket, the Neutron, is scheduled for launch next year with a maximum capacity of 15 metric tons.

Rocket Lab competes against SpaceX and other start-ups in the niche market for reusable rockets, but there could be plenty of room for all of these companies to flourish in this nascent market without trampling one another. It launched six Electron rockets in 2021, nine rockets in 2022, and 10 rockets in 2023. It launched another five rockets in the first half of 2024 and signed 17 new launch contracts.

Over the past year, the company won new launch contracts from NASA, the Internet of Things (IoT) connectivity provider Kinéis, and other space-focused customers. As it expands, analysts expect its revenue to achieve a compound annual growth rate (CAGR) of 54%, going from $245 million in 2023 to $887 million in 2026.

They also expect its adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) to turn positive by the final year. Rocket Lab’s stock isn’t a screaming bargain at 10 times next year’s sales, but it could soar a lot higher over the next few years if it successfully scales up its business.

Intuitive Machines develops lunar landing and exploration vehicles for NASA. It originally planned to launch its Nova-C lander in 2021, but that was repeatedly delayed. It also disappointed its investors by failing to win new stand-alone NASA contracts in 2022 and 2023.

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