Why Rocket Lab Stock Came Up Today

The rocket lab (RKLB 2.67%) the stock rose 4.6% by 10 a.m. ET Tuesday after it announced the successful launch of an Electron rocket carrying an unspecified payload for an undisclosed customer.

The launch was Rocket Lab’s 12th this year, surpassing the company’s previous record of 10 launches in a single year, set in 2023. With nearly two full months left in the year, Rocket Lab is likely to set an even higher annual record before 2024. ended, cementing its status as America’s most prolific rocket-launcher-not-called-SpaceX.

Almost no news is good news

Of course, we have no clear idea what Rocket Lab launched today… or for whom… or for how much money.

SpaceNews speculated today that the “confidential commercial customer” that Rocket Lab flew for may be satellite internet start-up E-Space, which applied for a “payload permit” from the New Zealand government in September (Rocket Lab launches most of its electrons). from New Zealand).

However, Rocket Lab would tell us that the “Changes in Latitudes, Changes in Attitudes” mission was launched less than 10 weeks after its client signed the contract. In a world where most customers have to wait years between contract signing and satellite launch, that alone gives Rocket Lab an edge over rivals like SpaceX, United Launch Alliance and ArianeSpace.

Is Rocket Lab stock a buy?

It’s also worth pointing out that while we don’t know exactly how much revenue Rocket Lab has had since Tuesday’s launch, we do know… that it probably doesn’t matter much.

According to data from S&P Global Market IntelligenceRocket Lab only earns 11% gross profit margins on rocket launches, which means the company is highly unlikely to make much money from launching rockets — no matter how often they launch or how much they charge. Instead, Rocket Lab cut profit margins by 25 percent building “space systems” (satellites and satellite parts) for its launch customers last year, making that business twice as profitable as launch services.

As crazy as it sounds, for “Rocket” Lab, launching rockets should probably be an afterthought.