Rocket Lab (RKLB -3.52%) is on a winning streak -- its stock, not so much.

Over the past month, the U.S.-based, New Zealand-operating small rocket company has:

  • Launched the CAPSTONE satellite mission for NASA, to preview the "Near Rectilinear Halo Orbit" where the space agency intends to place its Lunar Gateway space station a few years from now.
  • Announced two missions for the U.S. National Reconnaissance Office -- NROL-162 and NROL-199 -- and launched the first of these on July 13. (A second launch, scheduled for July 22, has been delayed at NRO's request so the agency can add "payload software updates."  
  • Reported a successful data transfer for DARPA's "Mandrake-2" mission "to demonstrate high-bandwidth optical inter-satellite links (OISL) via advanced laser communication technology."
  • Announced a new "dedicated Responsive Space Program" for launching customers' satellites within 24 hours of a payload's arrival at the launch site.
  • Confirmed the company is now building a new rocket every 30 days.
  • And promised to report its second-quarter 2022 financial results after market close on Thursday, Aug. 11.

So it's been a busy month for Rocket Lab. And yet, throughout this series of positive headlines, Rocket Lab's share price has barely budged. On June 24, Rocket Lab shares closed the trading day at $4.10. Through Tuesday's close this week, those same shares cost ... $4.10.

It raises the question: What exactly don't investors like about Rocket Lab?

Dollars and cents

Let's start with the obvious: Rocket Lab's PR office has been busy this past month, describing all the company's accomplishments. One thing notably absent from all of these press releases, however, has been any detail about how much Rocket Lab is being paid for all this work -- or whether it's profitable.

We'll get a better picture of Rocket Lab's profitability next month, of course, when the earnings report comes out. (Analysts are guessing "no," and predicting Rocket Lab will report a $0.06 per share loss.) In the meantime, here's what we know for sure.

With a current market capitalization of $1.9 billion, Rocket Lab has lost more than half its value since going public in a SPAC-sponsored IPO in August 2021. On the plus side, that IPO did at least provide Rocket Lab with a boatload of investor cash with which to build out its business. At last report, the company had roughly $455 million in cash, net of debt, on its balance sheet, which gives it an enterprise value closer to $1.5 billion.

Granted, the company is burning about $110 million in cash annually as it scales up. But even so, at its current rate of cash burn, this gives Rocket Lab about four years to reach positive free cash flow, so that it can fund its future growth without needing to sell more stock and dilute its shareholders.

Can Rocket Lab stock reach orbit in time?

This is good news for Rocket Lab investors because, according to estimates collected by S&P Global Market Intelligence, analysts believe that Rocket Lab will achieve positive free cash flow before its cash runs out. In fact, as early as 2024, analysts see Rocket Lab generating about $43 million in positive free cash flow -- and by 2026, it could generate more than $310 million.

If you believe those estimates, then an investment in $4-and-change Rocket Lab stock today could give you a stock trading for just five or six times 2026 estimated free cash flow (depending on how you calculate it) -- which sounds pretty cheap. Indeed, if you want to look even further out, by 2031, analysts have Rocket Lab pegged for $1.6 billion in free cash flow -- even more than its current enterprise value.

Mind you, 2026 is a long way away, and 2031 even further off. And like Yogi Berra said, "it's tough to make predictions -- especially about the future." Until Rocket Lab turns profitable, and gives us reliable profit margins to work from, investors' best bet for gauging the company's progress toward these goals will be its announcements of contracts (with or without financial details included), its quarterly financial statements, giving progress on revenue, and its guidance on expected future revenues.

In that regard, for Rocket Lab to be on track this year, we'll want to see revenues in the low $200 million range, and guidance for revenues in the low $300 million range in 2023.