Rocket Lab (RKLB 2.87%), a producer of reusable orbital rockets, usually doesn't get as much attention as its larger industry peer, SpaceX. But over the past 12 months, Rocket Lab's stock has nearly quadrupled as it dazzled the market with its rapid growth. It isn't profitable yet, but it could still be worth buying for four simple reasons.
Rocket Lab's Electron rocket can carry small payloads of up to 300 kilograms into low Earth orbit. It doesn't directly compete against SpaceX's Falcon rockets, which carry much larger payloads, and its top customers include NASA, the U.S. Space Development Agency (SDA), the Swedish National Space Agency, Kinéis, and BlackSky Technology.
Rocket Lab launched six Electron rockets in 2021, nine in 2022, 10 in 2023, 16 in 2024, and 21 in 2025. It's already launched seven more Electron rockets year-to-date, and it aims to launch more than 20 rockets for the full year. One of those rockets could be its upcoming Neutron rocket, which can carry much larger payloads of up to 13,000 kilograms.
Over the long term, Rocket Lab aims to evolve into an "end-to-end" space services company by expanding its Photon satellite bus platform, which boosts satellites into their intended orbits; offering more "ride-sharing" services for additional payloads; and producing more spacecraft, satellites, and subsystems for companies and government agencies.
It recently acquired Mynaric, a leading laser communications provider, to accelerate that strategy. It also secured its largest-ever contract, valued at $816 million, with the SDA to design and manufacture 18 satellites for a missile-defense satellite constellation.
As those catalysts kick in, analysts expect Rocket Lab's revenue to surge from $602 million in 2025 to $1.59 billion in 2028. They also expect it to turn profitable by the final year.
We should take those estimates with a grain of salt, but Rocket Lab is clearly carving out a high-growth niche in the nascent space exploration market. There's also plenty of room for Rocket Lab, SpaceX, and other rocket makers to run without stepping on each other's toes.
Rocket Lab, with a market cap of $63 billion, trades at 68.5 times this year's sales and 39.5 times its projected sales of 2028. It certainly isn't a bargain, but it could deserve that premium valuation if it expands and evolves into a space services giant over the next decade.