TLDR
- Rocket Lab stock rose 2.8% to $78.14 on Monday, trading above its 50-day and 200-day moving averages with heavy trading volume
- The company beat earnings estimates by $0.02 per share and reported Q3 revenue of $155.08 million, up 48% year-over-year
- Analysts maintain a “Moderate Buy” rating but their average price target of $61.25 sits below the current share price
- CEO Peter Beck sold 1.56 million shares worth nearly $90 million in December, part of 2.73 million insider shares sold in 90 days
- Despite revenue growth, Rocket Lab remains unprofitable with a negative net margin of 35.6% and full-year EPS expected at -$0.38
Rocket Lab Corporation shares climbed 2.8% to $78.14 on Monday. The stock traded on heavy volume with over 33 million shares changing hands.
The stock now trades well above key technical levels. The 50-day moving average sits at $56.30 while the 200-day moving average is at $50.94.
Over the past month, shares gained 54.91%. This outpaced the Aerospace sector’s 10.26% gain and the S&P 500’s 0.55% increase.
The company’s market cap stands at approximately $41.7 billion. The stock carries a beta of 2.16, indicating higher volatility compared to the broader market.
Rocket Lab reported third-quarter results on November 10th. Revenue came in at $155.08 million, beating the consensus estimate of $152.45 million. This marked a 48% increase from the same quarter last year.
The company posted a loss of $0.03 per share. This beat analyst expectations of a $0.05 loss by $0.02.
For the upcoming earnings release, analysts expect a loss of $0.05 per share. Revenue estimates sit at $178.38 million, representing 34.74% year-over-year growth.
Financial Health and Profitability Concerns
The company maintains a debt-to-equity ratio of 0.32. Its current ratio of 3.18 and quick ratio of 2.83 suggest strong liquidity.
However, profitability remains elusive. Rocket Lab posted a negative net margin of 35.64% and a negative return on equity of 27.26%.
For the full fiscal year, analysts project a loss of $0.20 per share on revenue of $600.52 million. The sell-side expects EPS of -$0.38 for the current fiscal year.
The company’s Zacks Rank currently sits at #3 (Hold). This places it in the middle of the ranking system’s range from #1 (Strong Buy) to #5 (Strong Sell).
Analyst Views and Insider Activity
Wall Street analysts hold mixed views on the stock. Two analysts rate it as Strong Buy, seven as Buy, five as Hold, and one as Sell.
The consensus rating is “Moderate Buy” with an average price target of $61.25. This target sits roughly 22% below the current trading price.
Morgan Stanley lowered its price target from $68 to $67 with an “equal weight” rating in November. Bank of America raised its target from $50 to $60 with a “buy” rating later that month.
Insider selling has been active recently. CEO Peter Beck sold 1.56 million shares on December 15th at an average price of $57.47. The transaction totaled nearly $90 million.
This sale reduced Beck’s ownership by 62.41%. He now directly owns 939,746 shares valued at approximately $54 million.
SVP Arjun Kampani sold 28,615 shares on November 24th at $40.65 per share. Over the past 90 days, insiders sold 2.73 million shares worth $152 million.
Insiders currently own 11.90% of the company’s stock. Institutional investors hold 71.78% of shares.
Baillie Gifford & Co. grew its position by 176.1% in the third quarter. The firm now holds 12.1 million shares valued at $580.9 million.
Rocket Lab operates as a launch services and spacecraft manufacturer. The company’s Electron rocket deploys small satellites to low Earth orbit. It also manufactures the Rutherford engine using additive-manufactured components.
Get 3 Free Stock Ebooks
Discover top-performing stocks in AI, Crypto, and Technology with expert analysis.
- Top 10 AI Stocks - Leading AI companies
- Top 10 Crypto Stocks - Blockchain leaders
- Top 10 Tech Stocks - Tech giants
