"Space is hard," is a saying familiar to anyone with even a passing interest in the space industry.

Astronaut Scott Kelly famously tweeted the line back in 2015, while peering down from the International Space Station and seeing a SpaceX rocket -- full of supplies for himself and his fellow astronauts -- turn into a fireball midflight.

And let's be frank: Space investing is pretty hard, too. Last year, I published a list of a half-dozen recent space companies that had already or were just about to IPO. Here's how they've all fared over the past year -- losses of anywhere from 24% to 84% each.  

ASTR Total Return Price Chart

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And yet, hope springs eternal for space investors. I think it's pretty clear now that there was way too much hype built into the SPAC process by which these companies marketed their IPOs. That being said, expectations now seem to have been reset -- and from their new and improved price points, at least two space stock names -- Rocket Lab (RKLB 0.24%) and Planet Labs (PL -3.45%) look poised to explode higher in 2022 and beyond.

Rocket blasting into space above a cloud layer with moon visible in sky.

Image source: Getty Images.

Rocket Lab USA

Let's start with the relative success story. Rocket Lab USA -- the U.S. arm of a small rocket company that operates primarily out of New Zealand.

At $9 a share, Rocket Lab actually costs less today than it did before its IPO, but the stock has risen as high as twice that pre-IPO price. What's more, at a total market capitalization of more than $4 billion, it's worth about as much as the next two biggest space SPACs to come to market so far -- combined.  

Why do investors value Rocket Lab so highly? It's no great surprise. Since beginning operations five years ago, Rocket Lab has successfully launched two dozen rockets to orbit, and it has maintained a launch cadence of about one launch every other month for the last three years.  

Financially speaking, it's still early innings for Rocket Lab. Total revenues from launch operations last year came to just $62 million, and S&P Global Market Intelligence shows the company to still be losing money and burning cash at present. Analysts forecast a near fourfold increase in revenues this year, however -- and a 20-fold increase in revenues over the next five years. Earnings should begin to turn positive in 2024, with free cash flow emerging that year as well.

Until that happens, it will remain exceedingly difficult to value the stock. But given the astoundingly strong revenue growth rate being projected, I think Rocket Lab stock has clear potential to outperform.

Planet Labs PBC

Valued at $1.4 billion, San Francisco-based Planet Labs is another of the more highly valued space SPACs -- and again, for good reason, because it's made a lot of progress in space. In contrast to Rocket Lab, whose business is launching satellites from Earth to orbit, Planet Labs' business starts up there in the sky, where it operates the world's largest constellation of Earth-imaging (think "spy") satellites.

At last report, Planet had more than 240 such orbiting eyes in the sky, a mixed fleet of Dove, SuperDove, and SkySat satellites -- the latter having been acquired from Google in 2017, which were the satellites originally responsible for such services as Google Maps and Google Earth.  

With $124 million in annual revenues, Planet is already arguably a bigger business than Rocket Lab, albeit not growing quite so fast. Analysts forecast about 50% revenue growth at the company next year, growing to $693 million by 2026 -- about 5.5x present-day revenues, which averages out to about a 44% annual revenue growth rate.  

Like Rocket Lab, Planet Labs is not yet profitable or free-cash-flow positive. Analysts don't expect the company to reach breakeven on either those metrics before 2025. Planet Labs, however, has published financial projections that suggest it could reach positive free cash flow by 2024 or even as early as late 2023.

Caveats and provisos for investors

Make no mistake: Neither of these space stocks is anything like a "sure thing."

With no profits, nor even free cash flow to hang a valuation on presently, the valuations of both these early stage space companies hinge largely on their growth prospects. And while both Rocket Lab and Planet Labs have taken strong leads in their respective fields (space launch and satellite imaging, respectively) they have yet to demonstrate that they can also grow their revenues and turn those revenues into earnings.

Investing in either one of them (or both, as I have done myself) is admittedly a bit of a gamble. But if they succeed in executing on the business plans they've laid out, I believe small bets on both these space stocks could pay off many times over.