If the Market Crashes, This Is the 1 Space Stock I Can't Wait to Buy
A steep sell-off could turn Rocket Lab into a compelling buy.
When the stock market experiences a downturn, Rocket Lab (NASDAQ: RKLB) is a space stock that the author is eagerly anticipating to invest in. Not because of its resilience during market crashes, but due to the risks associated with high-growth companies. Rocket Lab's current valuation, standing at nearly $40 billion or about 50 times its trailing sales, indicates that investors are paying a significant premium for anticipated future growth that hasn't yet been realized.
While this high valuation may be a red flag for some, the author sees it as a sign of increasing difficulty to overlook the company. Rocket Lab's second-quarter revenue reached a record high of $234 million, a 62% increase from the previous year, and its launch contract backlog hit another all-time high at $2.36 billion, marking a 137% increase.
The author also highlights that Rocket Lab has secured more than $437 million in new launch contracts after the quarter, reflecting a transformative shift from a speculative space start-up to a more stable business entity.
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