Rocket Lab USA (RKLB 2.33%) set its sights on the moon with its CAPSTONE mission, successfully launching the Cislunar Autonomous Positioning System Technology Operations and Navigation Experiment for NASA at 5:55 a.m. ET on June 28. The successful launch, carried out using Rocket Lab's Electron reusable rocket, carved one more successful notch in Rocket Lab's proverbial belt.
On July 4, the company's Photon deployable space vehicle entered the final stage of its mission, separating from the last launch stage of Electron to position CAPSTONE's CubeSat. The device should deliver exceptionally useful info about lunar orbits in preparation for NASA's future lunar station development, Project Artemis. Rocket Lab's varied toolkit and history of successes make it a strong contender to lead the future of satellite deployment. Current low share prices offer a chance to get in on the ground level of this potentially stellar delivery company as it positions itself for proverbial take off.
Image source: Getty Images.
Prepared to tackle space delivery
Satellite delivery may seem a niche market, but the total value of the global space economy stands at over $420 billion, allowing plenty of room for leaders to emerge and claim their share of that quickly growing pie. The industry grew more than 70% in the decade between 2010 and 2020, and that growth strongly weathered the recent perils of the pandemic. Even the current bear market may not put much of a dent in revenues if launch and deployment costs continue to drop as expected while the need for orbital presence grows.
Rocket Lab has two major launch and positioning tools in its arsenal, with another deep in development. The Electron reusable rocket enables multiple satellite launches using much of the same hardware in each, doubling production without additional investment, according to company CEO Peter Beck. The Photon deployable spacecraft now rides atop the Electron, delivering a method of precisely delivering satellites exactly into position.
The acquisition of Planetary System in October 2021 enabled the company to further grow its resources with an array of separation systems and satellite deployment canisters. The Neutron heavy launch rocket, capable of delivering 13,000-kilogram payloads to Mars and beyond, currently remains in development. Radios, software, and solar solutions round out a diverse offering focused on dominating space logistics. Continued innovation in the industry demonstrates the company's commitment to all aspects of stellar transport.
A history of success and reliable outside investment
To date, Rocket Lab has successfully completed 27 launches with its Electron rocket, deploying 147 satellites from its three launch pads. Each success further fuels confidence in both private- and public-sector investors. The neutron heavy lifter received $24 million from the U.S. Space Force for development of its upper stage. NASA continues to rely on Rocket Lab for successful deployment of a variety of orbital missions, including the CAPSTONE project and the Global Lyman-Alpha Imager of Dynamic Exosphere, or GLIDE, mission in 2025.
Recent successes, including "There and Back Again" on May 2, showcase the company's commitment to continued innovation. As the company works to refine its reusable rocket retrieval methods, it should continue to discover cost-saving methods that can further spur investment in the form of lowered barriers to satellite deployment for organizations that may find themselves currently priced out of the market.
Risks of the modern space race
Shooting for the stars always comes with risks. While Rocket Lab's launches are unmanned, they still run the risk of potential failure and negative press. Commercial and joint-venture governmental launches are high-profile events, often viewed by tens or hundreds of thousands of people.
Astra, a potential competitor that also grew out of a SPAC to launch an IPO last year, recently demonstrated the perils of bad news in the rocket race. After a failure to properly launch two weather satellites as part of NASA's TROPICS-1 program, the company's stock price fell sharply by 25% and now rests a third lower than before the event. Only the first of three contracts awarded to Astra by NASA, the launch failure strongly eroded investor confidence.
Failure can also damage or destroy launch vehicles, facilities, and valuable payloads. These risks further underscore the importance of research, development, and testing. Rocket Lab's own stock sits over 50% lower than last year's IPO at $9.82 per share, but continued good news likely indicates a turnaround for the company.
Potential for shares to go to the moon
Rocket Lab USA brings a versatile set of skills and tools to the table, and it continues to expand its assets with each passing quarter. As launches continue to ramp up and the company strives to develop newer, better technologies, Rocket Lab seems positioned to become a strong leader in the future of space transportation.
Since shares currently trade near record lows, Rocket Lab stock seems a relatively inexpensive bet that could pay off if shares go where CAPSTONE currently aims -- to the moon -- or at least its general orbit.
