High-temperature combustion test of the Archimedes engine that powers the company’s Neutron rocket.
rocket lab
Several pure-play space stocks rose last week, with what sector analysts called a “Trump-Elon trade” (reminiscent of the relationship between President-elect Donald Trump and SpaceX), with major stocks up more than 20%. CEO Elon Musk.
“I don’t think anyone underestimates the potential catalyst that a lot of people wouldn’t have talked about before. The most important people in the history of the space industry have been in the ear of the next president during this past term. “We had discovered a space important enough to create a separate branch of the military.” UFO It’s an ETF focused on space, he told CNBC.
I just saw it this week rocket lab 41% increase; intuitive machine 28% increase; Spire Global 26% increase; planet lab 16% increase; red wire 15% increase; AST Space Mobile 10% up.
These gains were driven in part by third quarter results and Rocket Lab’s progress and discrete updates on Neutron. spire sale Shut down maritime operations to eliminate debts.
But Cantor Fitzgerald analyst Andres Shepherd, who rates Rocket Lab, Redwire and Intuitive Machines as buys, said there’s also broader market sentiment driving these stocks. Ta.
“I think the risk-on rally after Trump’s victory is definitely reflected in this industry,” Shepard told CNBC.
Looking even further back to the beginning of the year, space stocks, which performed well this week, are poised to break out of their post-SPAC slump and triple or even quadruple in size by 2024.
“Space has been one of the strongest performers in the market this year for several of these companies,” Shepherd said.
“We are seeing a significant increase in inbound investors,” he continued. “We’re getting calls and emails from institutional investors who are finally starting to realize that this market is going to continue to accelerate because of national security and the Artemis program to get the United States. This market will only continue to grow.” Thanks to Elon, astronauts returned to the moon. [Musk]We have an ambitious goal of reaching Mars. ”
Shepard emphasized that the fact that Musk’s company SpaceX is privately held means investors are looking to other companies for exposure to the space sector. Similarly, ProcureAM’s Chanin believes SpaceX’s dominant position in rocket launch and satellite broadband actually helps companies with spacecraft seeking to fly into orbit.
“They all benefit from the low cost of access to space,” Chanin said.
Notably, this week also saw a divergence among pure space stocks. New companies that have gone public over the past few years have risen while older “legacy” companies have fallen. echo star and Viasatboth down more than 10% this week.
Alex King, CEO of Cestrian Capital Research, said the gap represents a generational shift in space companies.
“The need for all of these legacy businesses is decreasing. … I think what you’re seeing in space is a slow evolution of what’s happening with technology, where it’s very It happens quickly, and lower cost always wins in the end,” Ms. King said.
“I think there’s going to be an element in the market to see which companies survive and which ones don’t,” King added.
Despite the big gains by top space companies since the start of the year, Shepherd doesn’t think the sector will slow down anytime soon.
“Despite the outperformance, overall sentiment is very bullish and remains bullish,” Shepherd said.
This echoes the views of Rocket Lab CEO Peter Beck. He said on the company’s third-quarter earnings call this week that he expects the incoming Trump administration’s “very strong focus on space” to maintain the industry’s momentum.
“If space wins, Rocket Lab wins,” Beck said.
