Rocket Lab (RKLB) Stock Gains Analyst Support Despite 46% Decline

Key Takeaways

• Brian Gesuale of Raymond James launched coverage on RKLB with a Buy recommendation and $80 price objective, indicating approximately 30% potential upside.
• Shares of Rocket Lab have declined 46% during the previous three-month period, primarily driven by selling pressure after SpaceX’s June public offering.
• The aerospace firm reported a backlog totaling $2.36 billion at quarter-end, representing a 137% increase compared to the prior year.
• Gesuale anticipates Rocket Lab achieving positive free cash flow by 2028, two years before SpaceX’s projected 2030 milestone.
• Among Wall Street analysts tracking RKLB, 83% assign Buy ratings, with a consensus price objective near $112.

Rocket Lab (RKLB) secured a new Buy recommendation from Raymond James this Friday, as analyst Brian Gesuale established an $80 price objective. Shares climbed 1.6% to reach $62.95 during the trading session.

Rocket Lab USA, Inc., RKLB

Gesuale’s $80 projection implies about 30% appreciation from current trading levels, although it remains considerably below the average Wall Street price target hovering around $112.

The stock has experienced turbulent times recently. RKLB shares tumbled 46% during the three-month stretch leading into Friday’s session, following peak levels exceeding $150 in late May. The stock dipped under $59 in late July, just weeks following SpaceX’s public market debut.

The decline wasn’t rooted in poor operational performance. Rocket Lab delivered second-quarter revenue that surpassed analyst expectations in August and provided encouraging third-quarter guidance.

The primary driver was enthusiasm surrounding the SpaceX IPO. Space sector equities rallied leading up to the June offering, then experienced sharp corrections after the pricing event. Even SpaceX shares slipped beneath their $135 IPO level soon after the debut.

Rocket Lab’s quarterly revenue reached $234.1 million, marking a 62% year-over-year increase. The company maintains a cash position exceeding $2 billion.

Expanding Backlog Strengthens Bull Thesis

Gesuale highlighted Rocket Lab’s $2.36 billion order backlog as a fundamental driver supporting his positive outlook. This represents a 137% surge versus the comparable period in the previous year.

The expanding order book demonstrates strong demand for the company’s Electron rocket along with the forthcoming Neutron medium-lift launch vehicle, engineered to compete in larger payload categories.

Gesuale characterized Rocket Lab as a complete end-to-end mission solutions provider, delivering components, software platforms, and satellite systems to civil, commercial, and national security clients.

This diversified capability, according to his analysis, generates reliable recurring revenue streams that launch-only competitors cannot match.

Iridium Acquisition Reshapes Competitive Position

Last June, Rocket Lab unveiled its intention to acquire Iridium, providing access to a satellite communications network. This strategic move positions the company more directly against SpaceX, which runs the Starlink constellation.

Gesuale noted that following completion of the Iridium transaction, Rocket Lab will stand as the sole vertically integrated space enterprise with positive free cash flow and a partnership-focused approach.

His financial model projects standalone Rocket Lab revenue approaching $1.8 billion by 2028, expanding to approximately $2.9 billion on a pro forma basis when Iridium is included.

These figures compare to projected 2026 revenue of roughly $960 million, up from an estimated $600 million in 2025.

The company is anticipated to achieve positive free cash flow in 2028, consistent with Wall Street’s consensus forecast. SpaceX isn’t expected to hit this profitability benchmark until 2030.

In total, 83% of analysts following RKLB maintain Buy ratings, significantly exceeding the standard 55% to 60% Buy-rating proportion typical for S&P 500 companies. The consensus analyst price target stands at roughly $112.

Raymond James aligns with the broader positive sentiment, though its $80 objective takes a more measured stance compared to the Street’s average expectation.