Space stocks were soaring on Tuesday—again. SpaceX seems to be the cause—again—with the 12th test of its huge Starship rocket launching on Friday evening.
Shares of Rocket Lab, which offers satellite building and launch services similar to those of SpaceX, gained 5.5%, while the S&P 500 rose 0.6% and the Dow Jones Industrial Average added 0.2%, respectively.
Shares of AST SpaceMobile, which offers space-based broadband similar to Starlink, rose 13.1%
Shares of two other space stocks, Firefly Aerospace and Redwire, gained 18.8% and 26.1%, respectively. Intuitive Machines traded as high as $45.52, but closed at $34.86, down 8.9%. NASA’s Moon Base news conference seemed to take some of the momentum out of that stock.
Momentus Inc. rose 109.8%; Sidus Space rose 21.1%; Planet Labs rose 9%; Virgin Galactic rose 8%.
NASA is working toward a sustained U.S. presence on the moon, beginning with a series of uncrewed lunar missions. Investors may have been disappointed that Blue Origin was selected to send a lunar lander to the moon this fall. Intuitive Machines has already completed two lunar landings.
All three of those stocks rose by double-digit percentages on Friday. AST stock rose 10%. Rocket Lab only rose 8%.
SpaceX’s scrubbed Thursday launch might have led to Friday’s sector gains. Perhaps investors realized that developing space technology is hard, and that anyone who has succeeded, such as Rocket Lab, is more valuable.
Tuesday’s gains follow the Starship test flight, which had its highs and lows. The completely redesigned version three of the rocket demonstrated engine upgrades and successfully deployed dummy satellites. Still, there were some engine issues with the booster and upper stage.
The upper stage exploded spectacularly in the Indian Ocean. That wasn’t unexpected. Investors should realize that SpaceX doesn’t mind showing off all that happens in developing space tech.
Echostar stock, which owns millions of SpaceX shares, pending the closing of its wireless spectrum sales, was a relative laggard, falling 0.9% on Tuesday. That could be a sign that investors were disappointed with Starship. It’s also a sign that SpaceX’s valuation isn’t up today.
Any perceived failure in Starship test 12 probably isn’t the reason space stocks are soaring. It wouldn’t be a good reason anyway. SpaceX has simply brought more investors to the space sector, showing what’s possible. SpaceX’s Starlink product has more than 10 million subscribers, generating billions in annual sales and profit. Now, SpaceX wants to put AI data centers in space.
SpaceX is on the cusp of completing a record-setting IPO that will value the company at $2 trillion. That valuation has been good for the sector.
Coming into Monday trading, Rocket Lab and AST shares were up 372% and 326% over the past 12 months, respectively. The pair is valued at about $120 billion, which is still a fraction of SpaceX’s huge valuation.
There is risk in relative valuation, though. Neither company is profitable yet. Rocket Lab stock trades for about 75 times sales expected over the coming 12 months. AST stock trades for about 100 times.
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