Good news became bad news for Rocket Lab USA (RKLB +0.07%) on Friday after the company announced its successful return to launch operations for the first time since a mishap resulted in the destruction of an Electron rocket in September -- and the stock promptly fell.
As of 2:50 p.m. ET, Rocket Lab stock is down 9.6%.
NASDAQ: RKLB
Key Data Points
What happened to Rocket Lab's rocket?
This is...a bit strange, to say the least, because, by all accounts, Rocket Lab's launch went swimmingly. Launching out of New Zealand this morning, a Rocket Lab Electron rocket successfully deployed an Earth-imaging satellite for its customer, Japan's Institute for Q-shu Pioneers of Space, Inc. (iQPS).
This success means Rocket Lab has now launched more rockets (10) in 2023 than in any previous year and remains America's No. 2 space company by number of rockets launched annually -- for the fifth straight year, as the company pointed out.
Are investors right to be upset?
So, what's wrong with any of this? Honestly, I'm at a loss to find a connection between what Rocket Lab said and how investors are reacting to it.
On the other hand, earlier this week, Rocket Lab stock did go on something of a run in the run-up to today's launch. Perhaps caught up in general market enthusiasm over the Fed's announcement that it won't raise interest rates again this year and might even cut them a bit next year, Rocket Lab stock was at one point up nearly 8% from last week's close...before giving that all back today.
Perhaps that exuberance was a bit irrational, and maybe Rocket Lab did deserve to give a bit of it back today after the initial rate-news excitement passed. Even so, the company has just proven it correctly identified the issue with its last rocket, fixed it, and is back in business today.
I call that good news -- and not a good reason to sell Rocket Lab stock today.
