KeyBanc Capital Markets upgraded Rocket Lab (RKLB) and Firefly Aerospace (FLY) to 'Overweight' from 'Sector Weight' in Monday premarket trading, citing current NASA activity accelerating at a pace not seen since the Apollo era. The upgrades came after both stocks declined on SpaceX's IPO day, with RKLB falling more than 10% and FLY dropping more than 19%. Space sector activity is entering its busiest period since the first moon landing, according to KeyBanc, driven by NASA's doubled-down space exploration efforts through Artemis missions aimed at establishing a Moon Base.
At the time of writing, both stocks were up more than 6% in premarket trading on Monday.
KeyBanc Assigns Price Targets With Upside Potential
KeyBanc believes both companies are set to benefit from "compelling opportunities across the rapidly growing space sector" with exponential growth potential for satellites and space-based applications, even as launch supply remains "structurally constrained," according to TheFly. The firm views Rocket Lab and Firefly Aerospace as "well-capitalized" commercial space companies with exposure to national security and NASA priorities.
RKLB has a price target of $135, implying an upside potential of roughly 32% as of the stock's last closing price. FLY has a price target of $50, implying a 57% upside potential.
Rocket Lab and Firefly Aerospace See Recent Positive Developments
For Rocket Lab, recent catalysts include joining the Nasdaq-100 this month, a crucial certification from the Space Development Agency for its missile-interception solution, and growing opportunities in the commercial launch services market.
Firefly was recently selected by NASA to provide lunar drones as part of the Moon Base initiative and continues to see growing opportunities to carry payloads through its launch services.
NASA Doubles Down on Artemis Moon Base Initiative
The top U.S. space agency has doubled down on its space exploration efforts and is working to establish a Moon Base through its Artemis missions, which will support life and are among the initial steps toward transitioning humans from Earth to Mars.
The ambition to become an interplanetary species has increasingly driven demand for very large energy storage systems that can be deployed in space, as access to traditional power grids will not be possible. Companies are seriously considering sending data centers and advanced computing infrastructure into space, which can provide cybersecurity, artificial intelligence, national security, and defense solutions from up above.
Wall Street Analysts Rate Both Stocks Bullish
On Stocktwits, retail sentiment around both stocks remained in 'bullish' territory over the past 24 hours.
Wall Street is largely bullish on both companies, with 14 of 18 analysts rating Rocket Lab a 'Buy' or higher, and 6 of 9 rating Firefly Aerospace similarly. Neither of them has any 'Sell' ratings.
RKLB has surged 47% so far this year, while FLY has surged 43%, outperforming the S&P 500.
FAQ
What did KeyBanc do with Rocket Lab and Firefly Aerospace stock ratings?
KeyBanc Capital Markets upgraded both Rocket Lab (RKLB) and Firefly Aerospace (FLY) to 'Overweight' from 'Sector Weight' on Monday, citing current NASA activity accelerating at a pace not seen since the Apollo era. The firm assigned RKLB a price target of $135 (roughly 32% upside) and FLY a price target of $50 (57% upside).
Why did RKLB and FLY stocks rise in premarket trading?
Both stocks were up more than 6% in Monday premarket trading following KeyBanc's upgrade. The firm believes both companies are "well-capitalized" commercial space companies with exposure to national security and NASA priorities, positioned to benefit from exponential growth potential in satellites and space-based applications.
How many Wall Street analysts rate Rocket Lab and Firefly Aerospace as 'Buy'?
14 of 18 analysts rate Rocket Lab a 'Buy' or higher, and 6 of 9 rate Firefly Aerospace similarly. Neither company has any 'Sell' ratings from Wall Street analysts.
