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On Friday, Stifel analysts revised their price target for Rocket Lab USA (NASDAQ:RKLB) shares, reducing it from $31.00 to $27.00, but they retained a Buy rating on the stock. According to InvestingPro data, analyst targets now range from $13.50 to $35.00, with the stock showing remarkable growth of over 330% in the past year despite recent volatility. The adjustment followed Rocket Lab’s latest financial disclosure, where the company reported revenues at the upper end of its projected range and a smaller-than-anticipated adjusted EBITDA loss.
Rocket Lab’s guidance for the first quarter did not meet expectations, with anticipated lower average selling prices (ASPs) affecting launch revenue, and a mix of factors influencing space systems revenue recognition. Despite these near-term challenges, Stifel analysts see any decline in the stock’s price as an opportunity for investors, anticipating a return to growth in the second quarter and an acceleration later in the year. InvestingPro data shows impressive revenue growth of 78% in the last twelve months, though the company maintains a moderate debt level with a current ratio of 2.04.
The development of Rocket Lab’s Neutron rocket has reached significant milestones, although its timeline has been extended into the second half of 2025 due to the inherent complexities of rocket development programs. This represents a slight delay from initial expectations.
Stifel’s analysts underscored the Neutron project as a pivotal catalyst for Rocket Lab, with the potential to significantly expand the company’s total addressable market (TAM). Additionally, the introduction of a new low-cost, mass-producible satellite designed for large constellations could be transformative for the industry. According to the analysts, this positions Rocket Lab to complete its transition into a comprehensive end-to-end space company.
In other recent news, Rocket Lab USA reported significant developments in its financial and operational activities. The company announced a 121% year-over-year revenue increase for the fourth quarter of 2024, reaching $132.4 million, surpassing the forecast of $129.61 million. However, the earnings per share (EPS) fell short of expectations, with an actual EPS of -$0.10 compared to the forecasted -$0.09. Rocket Lab’s total backlog stands at $1.07 billion, reflecting robust future demand.
KeyBanc Capital Markets adjusted its price target for Rocket Lab, lowering it from $32 to $28 while maintaining an Overweight rating, following the company’s earnings report. Meanwhile, Cantor Fitzgerald has reaffirmed its Overweight rating with a price target of $24, highlighting the ongoing development of Rocket Lab’s Neutron rocket. The company has set ambitious goals, including the first launch of the Neutron rocket in the second half of 2025 and achieving several key milestones beforehand.
Rocket Lab has also signed a multi-launch agreement with a commercial satellite constellation operator, aiming for a minimum of 20 launches per engine in the Neutron project. The company plans to conduct over 20 launches in 2025 and has outlined a target of nine launches through 2027. These recent developments underscore Rocket Lab’s strategic focus on expanding its launch capabilities and enhancing its competitive position in the aerospace sector.
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