When SpaceX (SPCX -3.93%) went public on June 12, it made history as the largest IPO ever and sucked the oxygen out of the space sector. Many smaller space stocks, which had rallied in the months ahead of SpaceX's IPO, quickly lost their luster.
One of those stocks was Redwire (RDW +2.97%), a producer of critical space mission components, which went public through a merger with a special purpose acquisition company (SPAC) on Sept. 3, 2021. Its stock opened at $11.07 per share, set a record high of $25.90 on May 28, 2026, but now trades at about $13. Let's see if this mid-cap stock is worth buying after its recent pullback -- and if it could potentially evolve into the next SpaceX.
Image source: Getty Images.
What does Redwire do?
Redwire produces navigation, power, and 3D-printing components for satellites, space stations, and other spacecraft. It also sells military drones and custom components for missile defense and military communications systems. Its major customers include NASA, DARPA, the U.S. Space Force, international defense allies, and large commercial space contractors.
NASDAQ: SPCX
Key Data Points
Before Redwire went public, it predicted its revenue would rise from $163 million in 2021 to $1.41 billion in 2025. It also claimed its adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) would surge from $20 million in 2021 to $250 million in 2025.
But like many other SPAC-backed start-ups, Redwire overpromised and underdelivered. Here's what actually happened from 2021 to 2025.
|
Metric (Millions) |
2021 |
2022 |
2023 |
2024 |
2025 |
|---|---|---|---|---|---|
|
Revenue |
$137.6 |
$160.5 |
$243.8 |
$304.1 |
$335.4 |
|
Adjusted EBITDA |
$3.3 |
($11.0) |
$15.4 |
($0.81) |
($50.3) |
Data source: Redwire.
Redwire's slower-than-expected growth can be attributed to negative cost revisions on its fixed-price contracts, delayed government deals, and aggressive acquisitions that compressed its margins rather than boosting near-term revenue. To raise more cash, Redwire has more than quadrupled its share count since its market debut. That dilution, which was exacerbated by a $500 million at-the-market (ATM) equity offering this June, will persist for the foreseeable future. To make matters worse, its insiders have sold more than four times as many shares as they bought over the past 12 months.
From 2025 to 2028, analysts expect Redwire's revenue to grow at a 27% CAGR to $683.8 million. They also expect its adjusted EBITDA to turn positive in 2027 and increase more than five times to $51.7 million in 2028. That growth could be driven by the construction of orbital data centers, an acceleration in launches for low Earth orbit (LEO) satellites, NASA's new lunar missions, and the production of more sophisticated drones for the U.S. military.
Could Redwire become the next SpaceX?
With an enterprise value of $3.3 billion, Redwire doesn't seem pricey at 7 times this year's sales. SpaceX, with its enterprise value of $1.77 trillion, trades at 40 times this year's sales.
However, SpaceX trades at that premium because it owns three massive businesses: its Starlink satellite internet services, its namesake rocket launch services, and its AI business -- which houses xAI, X, Cursor, and its other related assets. SpaceX's investors believe the company can dominate and consolidate all three markets to become an end-to-end provider of rocket launch, satellite data, and space-based AI infrastructure services.
As SpaceX expands, it could eventually hurt smaller supply chain players like Redwire by manufacturing more of its components in-house and selling them to third-party customers. At the same time, Redwire still relies on SpaceX's rockets to carry its products into orbit.
While Redwire has been expanding its portfolio with more acquisitions, it's doubtful it will ever evolve into a vertically integrated space company like SpaceX. It will benefit from the same tailwinds for the space industry as SpaceX and face many of the same challenges. Still, it will likely follow a very different growth trajectory as the nascent market expands.
