KeyBanc Starts Rocket Lab USA (RKLB) at Overweight, 'We believe RKLB has ample capital to achieve FCF breakeven in 2H25'

KeyBanc analyst Michael Leshock initiates coverage on Rocket Lab USA (NASDAQ: RKLB) with a Overweight rating and a price target of $8.00.

The analyst comments "We initiate coverage on Rocket Lab USA (NASDAQ: RKLB) with an Overweight rating and $8 price target, reflecting ~50% upside. We view RKLB as one of the handful of companies within the Space industry with a proven business model and viable path to profitability in the next 1-3 years. The demand for both launch services and satellite manufacturing is increasing rapidly, and RKLB is among the few that can service this demand. Government budgets for space applications have increased annually over the past decade, offering further support for RKLB’s business (as evidenced by recent long-term contract wins). Production/testing setbacks are common in the space industry, though Electron’s track record and its progress to date on Neutron are encouraging. We believe RKLB has ample capital to achieve FCF breakeven in 2H25. Neutron remains on schedule to meet its targeted late 2024 launch date, and it possesses the ability to tap into a much larger TAM vs. its legacy operations. We view valuation as attractive, as it trades at a meaningful discount to its historical P/S multiple. Our $8 price target reflects ~8x P/S on our blended 2024/2025 estimates vs. its historical range of 15-20x. We see upside well in excess of our price target if the Company can execute on its mid- to long-term initiatives."

For an analyst ratings summary and ratings history on Rocket Lab USA click here. For more ratings news on Rocket Lab USA click here.

Shares of Rocket Lab USA closed at $5.17 yesterday.

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