Rocket Lab USA (RKLB), a leading space company offering launch services and space systems solutions, saw its stock price plummet 7.32% intraday on Wednesday. This significant drop came as investors and analysts expressed concerns over the company's valuation and future growth potential.

While RKLB has been touted for its strategic positioning in the space industry and recent contracts with NASA and the U.S. Department of Defense, some analysts believe that the company's optimistic growth prospects may have already been priced into its current stock valuation. According to a report from Simply Wall St, RKLB is trading around its estimated fair value, leaving little room for further upside based on its cash flow projections.

Moreover, RKLB's earnings over the next few years are expected to increase by 62%, indicating a highly optimistic future ahead. However, some experts caution that such lofty growth expectations may be challenging to meet, given the competitive landscape and the inherent risks associated with the space industry.