Rocket Lab stock analysis: why it’s rising and what comes next

Rocket Lab's stock price jumped more than 3%  after the company secured a major contract from the U.S. government. RKLB climbed to $72.15, about 12% above its lowest level this month. The key question now is whether this rebound marks the start of a sustained rally or is simply another dead-cat bounce.

Rocket Lab wins a big US government order

RKLB stock jumped after the SpaceX competitor won a $266 million contract by the Department of War. This contract is for its suborbital launch services of 12 vehicles with six optional ones.

The order will be implemented at its the Pacific Spaceport Complex in Alaska and will be completed by December 2028

Rocket Lab has emerged as one of the fastest-growing companies in the space industry. In its last financial results, the company said that its revenue jumped by 63% to $200 million as its revenue backlog soared by 20% to $2.2 billion.

The company is benefiting from its Electron orders, which have continued rising in the past few months. It is also positioning in the hypersonic space, with its Hypersonic Accelerator Suborbital Test Electron (HASTE). This product will likely continue doing well as the US government continues to invest in hypersonic technology.

It is also seeing more orders of the Neutron platform, which is its medium-lift, reusable orbital rocket that will compete with SpaceX Falcon 9. It will be much bigger than Electron and will be reusable. It signed five new Neutron launches in the first quarter. 

Rocket Lab’s business is booming such that it received more orders in the first quarter of the year than it did in the whole of last year.

RKLB to publish its earnings soon

The next key catalyst for the RKLB stock will be released early next month. These earnings are expected to show that its business did well in the last quarter as its revenue soared. 

The average estimate is that its revenue rose by 59% to $230 million in the second quarter. For the year, analysts expect the revenue to come in at $918 million, up by 52% YoY. 

In addition to the organic growth, the company is also focusing on acquisitions. It acquired Mynaric, which provides laser optical communications, Motiv Space Systems, and most recently, it bought Iridium, its biggest buyout on record.

Analysts have a bullish outlook for the RKLB stock. The average estimate is that its stock will jump to $110, much higher than the current $71. Some of the most bullish analysts are from companies like Citizens, Craig Hallum, and Roth Capital.

READ MORE: Rocket Lab stock analysis: megaphone forms as experts remain optimistic

Rocket Lab stock price technical analysis

RKLB stock chart | Source: TradingView

The weekly chart shows that the RKLB stock has pulled back sharply in the past few weeks. It dropped from a high of $151 in May to the current $71. It remains above the 100-week Exponential Moving Average (EMA). 

The stock remains above the ascending trendline that connects the lowest swings in April, November, and July. It has always rebounded after hitting this support level.

It is also in the process of forming a harami candlestick pattern. Therefore, the stock will likely bounce back in the near term. If this happens, the next key level to watch will be the psychological level of $100.