Rocket Lab USA Inc. (NASDAQ:RKLB) is soaring, both figuratively and literally. The SpaceX rival's stock jumped over 8% on Tuesday after securing a $23.9 million CHIPS Act grant to enhance its semiconductor operations in New Mexico.
This move not only boosts its production capabilities but solidifies its position in the burgeoning space economy.
The grant enables Rocket Lab to ramp up its manufacturing of advanced solar cells for satellites. As Brad Clevenger, VP of Rocket Lab Space Systems, highlighted, the funding bolsters U.S. leadership in compound semiconductor manufacturing while positioning Rocket Lab as a key player in space-grade technology.
Rocket Lab Stock Riding High On Momentum
Rocket Lab’s stock has been an investor's dream, skyrocketing 495% in the past year, 479% in six months, and 125% in just the last month.
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The bullish sentiment is well-supported by its technicals: the stock trades above its eight, 20, 50 and 200-day simple moving averages, signaling a strong uptrend. The moving average convergence/divergence (MACD) indicator is 3.65, bolstering the bullish momentum.
Its relative strength index (RSI) at 87.60, however, suggests the stock is overbought, leaving traders to ponder if this rally has more fuel or if a cooldown is imminent.
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Beyond Launches: Full-Stack Space Vision
Known primarily for its Electron rocket — now the third most frequently launched globally — Rocket Lab is expanding its horizons.
Its space systems division, which has powered over 1,100 satellites, is gaining traction with high-profile projects like NASA's Mars mission and a $515 million contract to build 18 spacecraft for the Space Development Agency.
Meanwhile, the upcoming Neutron rocket promises to take on heavier payloads, aiming to compete for lucrative U.S. Space Force contracts.
Eyes On The Space Economy
With the global space economy projected to reach $1.8 trillion by 2035, Rocket Lab's vertically integrated strategy—spanning launches, spacecraft manufacturing, and components—sets it apart.
From NASA’s Artemis program to the James Webb Telescope, its technology underpins critical missions, creating robust growth avenues.
While the stock's meteoric rise reflects optimism, the question remains: Can Rocket Lab maintain its trajectory in the face of intensifying competition and lofty valuations?
Investors seem eager to find out.
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