Space exploration company Rocket Lab (RKLB) saw its stock dive Tuesday after it was hit by a short report from Bleecker Street Research. That report claims the rocket maker has “materially misled investors about the likelihood that its Neutron rocket will launch in mid-2025.” Instead, it argues that, based on comments from experts, the company won’t launch its Neutron rocket until mid-2026 or mid-2027.
Bleecker Street Research notes that delayed launches would affect Rocket Lab’s revenue. The company continues to burn cash without generating funds from National Security Space Launch, which is expected to be a major source of contracts via its Phase 3 Lane 1 program. Adding to these troubles is Rocket Lab reportedly willing to sell launch contracts for a discount compared to its $50 million to $55 million launch price.
Finally, Bleecker Street Research claims cash burn is a real concern for RKLB shareholders. The company had $504 million in cash as of September, but experts predict it will need $300 million to $600 million to launch Neutron and make it profitable. This could require the company to seek additional funding before the rocket’s launch.
Recent RKLB Stock Movement
RKLB stock took a 9.83% beating yesterday alongside the Bleecker Street Research short report. That also spurred a stock selloff as 29.09 million shares changed hands. This was well above its three-month daily average trading volume of about 19.74 million units.
RKLB is recovering from yesterday’s drop with a 5.28% increase in pre-market trading. However, the shares still have to deal with a 20.38% fall year-to-date. More negative stock movement will likely follow if it fails to launch Neutron in 2025.
Is RKLB Stock a Buy, Sell, or Hold?
Turning to Wall Street, the analysts’ consensus rating for Rocket Lab is Moderate Buy based on five Buy and two Hold ratings over the last three months. With that comes an average price target of $27.08, a high of $35, and a low of $13.50. This represents a potential 33.53% upside for RKLB stock.
