Rocket Lab USA (RKLB) – Get Report plummeted in its first day of trading Wednesday after a SPAC merger, perhaps indicating the froth is coming off an overheated market for space-related stocks.
Rocket Lab recently traded at $10.36, down 10%. The drop came on the same day that Chief Executive Peter Beck rang the opening bell on the Nasdaq exchange.
He was undaunted by the stock drop, telling CNBC he hasn’t “really even been watching it,” adding that “at the end of the day, we’re in this for the long term.”
The deal garnered Rocket Lab $777 million and valued it at $4.8 billion. The company said it’s using the money to grow its core small rocket business, to increase its spacecraft division and manufacture a larger rocket called Neutron to compete with Elon Musk’s SpaceX, CNBC reports.
Rocket Lab is looking toward organic and inorganic growth, Beck said.
Plenty of other space-related companies have gone public too, and many analysts are skeptical of their prospects. But Beck’s not worried.
“I don’t think it will take long for investors to differentiate between the company that’s consistently delivering and the ones that have aspirations to deliver sometime in the future,” he said.
Virgin Galactic (SPCE) – Get Report, which in 2019 became one of the first space companies to go public, received a downgrade from Morgan Stanley analyst Kristine Liwag two weeks ago to underweight from equal weight, leaving her price target at $25.
A coming period of inactivity for the space company founded by Richard Branson moved her to act.
