Rocket Lab's Performance and Valuation - Rocket Lab's shares soared by 361% in 2024, significantly outperforming the S&P 500 and Nasdaq Composite [1][3] - The company's market cap is currently around $12.4 billion, which is considered rich based on current sales and lack of profitability [7] - Analysts forecast Rocket Lab to generate just below $1 billion in revenue by 2027, more than double the expected sales for 2024 [8] Comparison with SpaceX - SpaceX was valued at $350 billion in a secondary sale in December, with shares priced at $185 each [5] - Investing in SpaceX at a $350 billion valuation would require the company to reach $700 billion to double the investment, or $3.5 trillion for a 10x return [6] - The total addressable market (TAM) for the space economy is estimated to reach $1.8 trillion by the mid-2030s, making SpaceX's valuation seem high in comparison [7] Growth Prospects and Market Position - Rocket Lab is expected to reach profitability by 2027, with analysts bullish on its ability to gain market share despite competition from SpaceX [9] - The company's top-line acceleration is seen as a positive sign, indicating potential for profitability in the near future [9] - Rocket Lab's long-term success depends on management's ability to execute, particularly in capital allocation given the high capital expenditures required for building rockets and satellites [10][11] Investment Considerations - Rocket Lab is viewed as a speculative opportunity, suitable for investors with long time horizons and a high tolerance for risk [11] - The company's trajectory is encouraging, making it a potential candidate for a small position in a diversified portfolio [11]
After Soaring 361% in 2024, Is Rocket Lab Stock a Buy in 2025?