The stock seems to be falling in response to a Barron's article over the weekend suggested that "it's time to sell some shares" of the fast-rising space stock now that it's public and no longer a special purpose acquisition company.
It's hard to disagree. Since coming public in a SPAC-sponsored initial public offering last month, and reporting its first earnings as a publicly traded company last week, Rocket Lab stock (what else?) rocketed to more than double its pre-IPO price.
After a ride like that, the idea of taking some profits, as Barron's suggested, has to look attractive.
The more so when you consider that just this morning, analysts at Cowen (NASDAQ: COWN) initiated coverage of Rocket Lab stock and gave it only a lukewarm "market perform" rating and an $18 price target, which is below where the stock closed on Friday.
Although Rocket Lab is "the leading small satellite launch provider and consolidator of satellite components/services," according to StreetInsider.com, and has "competitive advantages, attractive launcher expansion path, and end-to-end market strategy [promising] robust extended growth," Cowen is taking a cautious approach to the stock at its current elevated valuation.
Until we get a better idea of how long it will take Rocket Lab to turn its soaring revenue into profits, I think that's sound advice.