Raymond James Financial Upgrades Rocket Lab (NASDAQ:RKLB) to "Moderate Buy"

Key Points

• Raymond James upgraded Rocket Lab to “Moderate Buy,” joining a broadly bullish analyst view. MarketBeat reports a consensus “Moderate Buy” rating and an average price target of $107.32, well above the stock’s $62.95 opening price.
• Rocket Lab’s latest quarter showed revenue of $234.07 million, slightly exceeding expectations, but adjusted earnings missed estimates at a loss of $0.08 per share. The company remains unprofitable, with analysts forecasting a $0.20-per-share loss for the fiscal year.
• Execution and valuation remain key risks: the stock has fallen substantially from its 52-week high, while insiders sold roughly $312.9 million of shares during the last quarter. Investors are also focused on the development and potential delays of Rocket Lab’s Neutron rocket.

Rocket Lab (NASDAQ:RKLB - Get Free Report) was upgraded by analysts at Raymond James Financial to a "moderate buy" rating in a research report issued to clients and investors on Friday, Zacks reports.

RKLB has been the topic of several other reports. Morgan Stanley reissued an "overweight" rating on shares of Rocket Lab in a research note on Wednesday, July 8th. Stifel Nicolaus set a $132.00 price objective on Rocket Lab in a research note on Thursday, June 4th. Roth Capital set a $110.00 target price on Rocket Lab in a report on Tuesday, August 11th. Needham & Company LLC reissued a "buy" rating on shares of Rocket Lab in a research report on Tuesday, August 11th. Finally, KGI Securities upgraded Rocket Lab from a "neutral" rating to an "outperform" rating and set a $107.00 price target on the stock in a report on Monday, July 27th. Four investment analysts have rated the stock with a Strong Buy rating, fourteen have given a Buy rating, five have assigned a Hold rating and one has given a Sell rating to the company's stock. Based on data from MarketBeat.com, the stock presently has a consensus rating of "Moderate Buy" and an average price target of $107.32.

Rocket Lab Stock Up 1.6%

NASDAQ RKLB opened at $62.95 on Friday. The company has a debt-to-equity ratio of 0.01, a quick ratio of 4.98 and a current ratio of 5.48. The company has a market capitalization of $37.67 billion, a P/E ratio of -233.14 and a beta of 2.60. Rocket Lab has a one year low of $37.57 and a one year high of $151.00. The stock has a 50 day moving average price of $71.58 and a 200-day moving average price of $84.45.

Rocket Lab (NASDAQ:RKLB - Get Free Report) last posted its earnings results on Monday, August 10th. The rocket manufacturer reported ($0.08) earnings per share for the quarter, missing analysts' consensus estimates of ($0.06) by ($0.02). Rocket Lab had a negative net margin of 21.51% and a negative return on equity of 6.48%. The business had revenue of $234.07 million during the quarter, compared to analysts' expectations of $231.62 million. As a group, equities analysts predict that Rocket Lab will post -0.2 EPS for the current fiscal year.

Insiders Place Their Bets

In other Rocket Lab news, CAO Agostino Ricupati sold 669 shares of the business's stock in a transaction that occurred on Monday, August 24th. The stock was sold at an average price of $69.63, for a total transaction of $46,582.47. Following the completion of the transaction, the chief accounting officer owned 26,863 shares in the company, valued at $1,870,470.69. The trade was a 2.43% decrease in their ownership of the stock. The sale was disclosed in a filing with the Securities & Exchange Commission, which is available at this link. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Also, SVP Arjun Kampani sold 6,034 shares of the firm's stock in a transaction that occurred on Thursday, August 27th. The stock was sold at an average price of $66.65, for a total value of $402,166.10. Following the sale, the senior vice president directly owned 250,917 shares of the company's stock, valued at $16,723,618.05. This represents a 2.35% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Insiders have sold 3,624,371 shares of company stock valued at $312,944,881 over the last quarter. Corporate insiders own 8.40% of the company's stock.

Institutional Inflows and Outflows

A number of hedge funds have recently made changes to their positions in RKLB. California State Teachers Retirement System increased its position in shares of Rocket Lab by 12,984.2% during the second quarter. California State Teachers Retirement System now owns 96,179,045 shares of the rocket manufacturer's stock worth $9,776,600,000 after acquiring an additional 95,443,970 shares during the period. BlackRock Inc. bought a new position in shares of Rocket Lab during the 2nd quarter worth $4,124,970,000. Capital World Investors raised its holdings in Rocket Lab by 12.0% in the fourth quarter. Capital World Investors now owns 16,200,726 shares of the rocket manufacturer's stock worth $1,130,172,000 after purchasing an additional 1,738,623 shares in the last quarter. Bank of New York Mellon Corp purchased a new stake in shares of Rocket Lab during the 2nd quarter valued at $245,764,000. Finally, State Street Corp boosted its position in shares of Rocket Lab by 1.0% in the 4th quarter. State Street Corp now owns 12,520,223 shares of the rocket manufacturer's stock worth $873,411,000 after purchasing an additional 120,652 shares in the last quarter. 71.78% of the stock is currently owned by institutional investors.

Key Rocket Lab News

Here are the key news stories impacting Rocket Lab this week:

• Positive Sentiment: Successful Electron launch supports near-term momentum. Rocket Lab deployed a confidential customer’s Earth-observation satellite into a 500-kilometer orbit. The mission was the company’s 95th Electron launch overall and its 16th this year, highlighting a reliable launch cadence in a capacity-constrained market. Another commercial launch is planned before the end of September. Rocket Lab Successfully Launches 16th Electron Mission
• Positive Sentiment: Analysts see substantial upside potential. Raymond James identified two opportunities with significant upside, while multiple analysts maintain Strong Buy ratings and price targets well above the current trading level. The bullish case is supported by Rocket Lab’s record revenue, expanding backlog, and more than $1 billion in new contracts since the second quarter began. Why Raymond James Is Betting Big on Rocket Lab
• Neutral Sentiment: The investment case depends on Neutron. Commentary argues Rocket Lab’s established launch and space-systems operations could justify taking the risk on its reusable Neutron medium-lift rocket. The company’s core business is improving, but Neutron’s development schedule has not changed, leaving investors focused on execution and potential delays. Rocket Lab's Core Business Makes the Neutron Gamble Worth Taking
• Negative Sentiment: Recent underperformance reflects company-specific concerns. RKLB declined sharply from mid-June through September 10 despite record revenue and new contracts, substantially underperforming major defense peers. The drop suggests investors remain concerned about Neutron execution, elevated expectations, and the stock’s high-risk valuation. What's Behind the RKLB Drop?
• Negative Sentiment: Insider selling is a notable overhang. Reported activity showed 97 insider sales and no purchases over the past six months, including substantial sales by CEO Peter Beck and other executives. This may reinforce concerns about valuation even as operating metrics improve.

About Rocket Lab

Rocket Lab USA, Inc is a space company that provides launch services and space systems for commercial, civil and national security customers. The company develops and operates launch vehicles, spacecraft and satellite components, with activities spanning the design, manufacture and operation of space hardware.

Rocket Lab's Electron rocket is a small-lift orbital launch vehicle designed to deploy small satellites. The company also develops HASTE, a suborbital test vehicle based on Electron technology, and is developing Neutron, a larger reusable launch vehicle intended to support a broader range of missions.

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