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    Why Rocket Lab (RKLB) Is Up 22.1% After Landing an $816 Million U.S. Defense Satellite Deal

    Simply Wall St·01/07/2026 00:35:54
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    • In late 2025, the U.S. Space Development Agency awarded Rocket Lab an US$816 million contract to design, build and operate 18 missile-tracking satellites under its Tracking Layer Tranche 3 program, as part of a wider US$3.50 billions order involving several major defense contractors.
    • This contract, Rocket Lab’s largest to date and around 58% larger than its previous record award, signals its growing role as a full-service defense and space-systems supplier able to compete for complex, long-duration government programs.
    • Now we’ll examine how winning an US$816 million U.S. defense satellite contract could influence Rocket Lab’s investment narrative and risk profile.

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    Rocket Lab Investment Narrative Recap

    To hold Rocket Lab, you need to believe it can turn its growing space systems and launch footprint into a durable, profitable business while funding heavy Neutron spending and managing contract lumpiness. The new US$816 million SDA award directly addresses the risk around dependence on large deal wins, but it does not remove near term pressure from ongoing cash burn and possible dilution if capital markets become less accommodating.

    The SDA Tracking Layer Tranche 3 contract stands out because it validates Rocket Lab’s push to be a full-service defense and space systems supplier, not just a small launch provider. It also adds multi‑year revenue visibility that could help offset volatility from Neutron’s development timing and any delays in broader government or commercial launch demand.

    Yet even with a record defense contract in hand, investors still need to be aware that...

    Read the full narrative on Rocket Lab (it's free!)

    Rocket Lab's narrative projects $1.3 billion revenue and $113.4 million earnings by 2028. This requires 37.5% yearly revenue growth and about a $344.7 million earnings increase from -$231.3 million today.

    Uncover how Rocket Lab's forecasts yield a $68.75 fair value, a 20% downside to its current price.

    Exploring Other Perspectives

    RKLB 1-Year Stock Price Chart
    RKLB 1-Year Stock Price Chart

    Seventy five Simply Wall St Community members place Rocket Lab’s fair value anywhere between US$10.61 and US$97.83, underscoring sharply different expectations. When you set those opinions against the company’s ongoing Neutron cash burn and reliance on big contract wins, it becomes even more important to compare several viewpoints before forming a view on the stock.

    Explore 75 other fair value estimates on Rocket Lab - why the stock might be worth less than half the current price!

    Build Your Own Rocket Lab Narrative

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    This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.