Rocket Lab (RKLB) recovers amid ‘breakthrough’ milestone and federal funding news
Rocket Lab stock (RKLB) rebounded Wednesday after eight straight days of losses as investors shrugged off a scathing report questioning the company’s project timelines.
The stock climbed 4.78% to $21.25 on February 26, offering a reprieve for a company whose meteoric rise has come back to Earth. Meanwhile, Deutsche Bank raised its price target to $24.
Not everyone is convinced. Short-biased fund Bleeker Street Research alleged Monday that space industry professionals disclosed a scheduled takeoff for this year is well behind schedule.
“We believe that RKLB has materially misled investors about the likelihood that its Neutron rocket will launch in mid-2025,” the report claimed.
(Bleeker Street disclosed that it holds a short position on Rocket Lab.)
Law firm Block & Leviton followed up with an announcement that it was investigating potential securities law violations, encouraging investors who lost money on Rocket Lab stock to contact them.
Rocket Lab shed nearly a third of its value between February 10 and February 24 but is still up 351% compared to a year ago.
That growth hasn’t translated to profitability. Rocket Lab posted a net loss of $137.8 million in the first nine months of 2024, in line with the prior year. Revenue and gross profits have doubled, but so have the costs of keeping the company in orbit.
Is the Neutron rocket behind schedule?
Rocket Lab has maintained that its Neutron rocket is still on track for a mid-2025 launch, last confirming the timeline in August 2024 after completing a hot-fire engine test at a NASA facility in Mississippi.
If successful, the company says it would be the fastest commercially developed rocket launch of its kind. The Neutron rocket is designed for deep space exploration, carrying astronauts, and will be reusable.
Bleeker Street Research disputes those claims, arguing that the project is significantly behind schedule.
According to the firm, documents and 23 interviews with industry experts, former Rocket Lab engineers, and executives show that the engine, launch pad construction, and launch site are not ready.
If Neutron faces delays, Rocket Lab’s revenue could take a hit, which Bleeker Street warns could spell broader trouble for the company. “Without Neutron, RKLB’s revenue goals for space don’t add up,” the report said.
A “breakthrough” milestone that went unnoticed
In the midst of the controversy, Rocket Lab quietly achieved a key milestone that attracted far less attention. On February 24, the company passed a Critical Design Review for the U.S. Space Force’s VICTUS HAZE mission, set to launch later this year from New Zealand.
Operating in near-orbit space, the mission will test whether rockets can be deployed within 24 hours to target potential threats.
“VICTUS HAZE solidifies Rocket Lab as a trusted and highly capable, end-to-end space company that can enable complex missions to serve the needs of the nation,” said Brad Clevenger, President and CEO of Rocket Lab National Security.
In other news, the Trump administration is reportedly planning to modify conditions on CHIPS Act funding. The updated act is expected to direct $23.9 million to Rocket Lab to expand manufacturing capacity.