Rocket Lab’s business is firing on all cylinders — revenue jumped 45.8% over the past twelve months, quarterly records fell, and the launch manifest is bursting. Yet the stock has been battered. Over six consecutive trading sessions, the company lost roughly $14 billion in market capitalization, a sell-off so sharp that it erased nearly 30% of the share price in a single month. The S&P 500, by contrast, rose 0.4% over the same stretch, underlining that the pain is company-specific, not a symptom of broader market weakness.
The primary culprit, according to market observers, is the planned $8 billion acquisition of Iridium Communications. Announced in late June, the deal carries a substantial cash-and-equity component, and investors are wrestling with how Rocket Lab will fund the transaction, how much leverage it will take on, and whether existing shareholders face significant dilution. Although several analysts bumped up their price targets after the announcement, the subsequent slide suggests the market is still digesting the financing mechanics.
Adding to the pressure, insiders have been selling. Company president Marvin Bradford Clevenger offloaded 19,049 shares for roughly $2.73 million, while chief financial officer Jon A. Olson disposed of 15,205 shares valued at around $1.39 million. The insider sales have compounded the unease, even if the underlying business remains on a growth trajectory.
The operational engine, meanwhile, shows no signs of stalling. Rocket Lab’s two business segments — Launch Services, powered by the Electron rocket and hypersonic test vehicles, and the larger Space Systems division, which builds satellites and components — generated combined first-quarter revenue of $200.4 million. Management has described recent months as “phenomenal,” citing record backlog and a flood of new launch contracts.
Central to the long-term valuation debate is the Neutron rocket, a larger, reusable vehicle that Rocket Lab views as the key to its profitability targets. After a setback during tank tests, the company now targets the first flight for the fourth quarter of 2026 — later than initially planned. Progress on Neutron milestones is likely to act as a major catalyst, for better or worse, as the stock searches for a floor.
Should investors sell immediately? Or is it worth buying Rocket Lab?
The growth, however, comes at a steep price. Rocket Lab trades at roughly 72 times trailing sales, compared with the S&P 500’s median of 3.3 times. The operating margin stands at negative 33.2%, a stark contrast to the index’s positive 18.4% median. The negative earnings are reflected in a price-to-earnings ratio of minus 254.4, underscoring that the company is still generating losses even as it scales revenue.
Wall Street has not flinched. Of 16 analysts polled by S&P Global, the consensus rating remains a “Buy,” with an average price target of $106.31. Targets range from $77 to $150. B of A Securities reaffirmed a $115 target on June 30, projecting a potential upside of nearly 50% over the next twelve months. The bullish view persists despite the technical damage: the stock now sits about 27% below its 50-day moving average of €94.52 but remains roughly 2.7% above its 200-day average of €67.26. The relative strength index registered 34.5, a level that typically signals oversold conditions and the potential for a bounce.
The options market reflects continued anxiety. Implied volatility has climbed to 91, placing it in the 71st percentile of its 52-week range. The annualized 30-day volatility stands at 95.42%, underscoring that traders expect more turbulence ahead.
For now, the stock’s fate hinges on two factors: clarity around the Iridium deal financing and tangible progress on Neutron. Until those pieces fall into place, Rocket Lab shares are likely to remain sensitive to headlines — both company-specific and macro — as they attempt to stabilise well below the May high of €133.80.
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