Al Root

Rocket Lab USA stock tumbled after the commercial space company reported fourth-quarter numbers that were very close to Wall Street's expectations.

Guidance didn't live up to expectations, which were high coming into the report. More important -- a key new product faces a delay because "space is hard."

Rocket Lab reported a fourth-quarter per-share loss of 10 cents from record sales of $132.4 million on Thursday evening. Wall Street was expecting a 9 cents loss and sales of about $130 million.

For the full year, Rocket Lab generated sales of $436 million, up 78% year over year. It has launched 16 rockets, up from 10 in 2023.

Results were broadly in line with expectations.

Looking ahead, Rocket Lab expects first-quarter 2025 sales of about $120 million and a loss of about $34 million in earnings before interest, taxes, depreciation, and amortization (Ebitda). Coming into the earnings report, Wall Street was projecting closer to $130 million in sales and a loss of $30 million.

Guidance was a little light. Rocket Lab stock was down almost 12% in premarket trading at $17.52 a share, while S&P 500 and Dow Jones Industrial Average futures were up about 0.3%.

Coming into Friday trading, Rocket Lab stock was up 332% over the past 12 months. Performance like that raises expectations, even though shares were hit in the recent market selloff, falling about 30% in February.

Stifel analyst Erik Rasmussen called the quarter "solid" in a Friday report, but noted that the company pushed out the launch of its larger Neutron rocket to the second half of 2025, "a few months longer than expected."

Neutron is Rocket Labs' larger space-launch vehicle. It currently launches payloads on its Electron rocket, which can carry about 300 kilograms to space. Neutron will carry 13,000 kilograms.

Rasmussen rates shares Buy, but lowered his price target to $27 for $31 to account for the Neutron delay and first-quarter guidance.

"We haven't come across a space program that hasn't been delayed, and RocketLab's Neutron is no different, with first launch now slated for second half 2025," wrote Citi analyst Jason Gursky in a Friday report. "It wouldn't surprise us to see further delays as more testing is done. Space, after all, is hard."

He rates shares Buy. He took his price target to $33 from $35 after earnings.

Delays are par for the course in space. So is stock market volatility. Still, Wall Street likes Rocket Lab stock. Overall, 57% of analysts covering the stock rate shares Buy, a little better than the average Buy-rating ratio for stocks in the S&P 500. The average analyst price target is about $25 a share, up about 45% from early Friday levels.

Write to Al Root at allen.root@dowjones.com

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February 28, 2025 07:58 ET (12:58 GMT)

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