TLDR
- Raymond James analyst Brian Gesuale initiated coverage of RKLB with a Buy rating and an $80 price target, roughly 30% above recent levels.
- Rocket Lab stock has dropped 46% over the past three months, largely due to a selloff following the SpaceX IPO in June.
- The company ended its latest quarter with a $2.36 billion backlog, up 137% year over year.
- Gesuale projects Rocket Lab will reach positive free cash flow in 2028, ahead of SpaceX’s expected 2030 timeline.
- 83% of analysts covering RKLB rate it a Buy, with an average price target of around $112.
Rocket Lab (RKLB) picked up a fresh Buy rating from Raymond James on Friday, with analyst Brian Gesuale setting an $80 price target. The stock rose 1.6% to $62.95 on the day.
The $80 target represents roughly 30% upside from recent levels, though it sits well below the broader Wall Street consensus target of around $112.
RKLB has had a rough few months. The stock fell 46% over the three months heading into Friday, after trading above $150 in late May. It closed below $59 in late July, a few weeks after the SpaceX IPO.
The drop wasn’t driven by bad results. Rocket Lab posted better-than-expected second-quarter sales in August and gave a solid third-quarter outlook.
The real culprit was the SpaceX IPO hype. Space-related stocks ran up into the June listing, then sold off sharply once it priced. SpaceX stock itself fell below its $135 IPO price shortly after launch.
Quarterly revenue at Rocket Lab came in at $234.1 million, up 62% year over year. The company holds a cash reserve of more than $2 billion.
Record Backlog Fuels Bullish Case
Gesuale pointed to Rocket Lab’s $2.36 billion backlog as a key reason for optimism. That figure is up 137% compared to the same period last year.
The growing backlog reflects demand for its Electron rocket and the upcoming Neutron medium-lift vehicle, which is designed to compete at a larger scale.
Gesuale described Rocket Lab as a comprehensive end-to-end mission provider, supplying components, software, and satellite platforms for civil, commercial, and national security customers.
That breadth, he argued, creates sticky recurring revenue that pure-play launch competitors don’t have.
Iridium Deal Changes the Picture
In June, Rocket Lab announced plans to acquire Iridium, giving it a satellite communications network. That puts it in closer territory to SpaceX, which operates Starlink.
Gesuale wrote that once the Iridium deal closes, Rocket Lab will be the only vertically integrated space company with positive free cash flow and a partnership-led strategy.
He projects standalone Rocket Lab revenue of around $1.8 billion by 2028, rising to roughly $2.9 billion on a pro forma basis including Iridium.
That compares to roughly $960 million in expected 2026 sales, up from around $600 million in 2025.
Free cash flow is expected to turn positive in 2028, in line with Wall Street consensus. SpaceX is not projected to reach that milestone until 2030.
Overall, 83% of analysts covering RKLB rate it a Buy, well above the typical 55% to 60% Buy-rating ratio for S&P 500 stocks. The average analyst price target sits at approximately $112.
Raymond James joins a strong consensus view, even if its $80 target is more conservative than the Street average.
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