Rocket Lab USA, Inc. (NASDAQ:RKLB): Are Analysts Optimistic?

Rocket Lab USA, Inc. (NASDAQ:RKLB) is possibly approaching a major achievement in its business, so we would like to shine some light on the company. Rocket Lab USA, Inc., a space company, provides launch services and space systems solutions for the space and defense industries. On 31 December 2023, the US$2.0b market-cap company posted a loss of US$183m for its most recent financial year. As path to profitability is the topic on Rocket Lab USA's investors mind, we've decided to gauge market sentiment. We've put together a brief outline of industry analyst expectations for the company, its year of breakeven and its implied growth rate.

View our latest analysis for Rocket Lab USA

Consensus from 9 of the American Aerospace & Defense analysts is that Rocket Lab USA is on the verge of breakeven. They expect the company to post a final loss in 2025, before turning a profit of US$45m in 2026. So, the company is predicted to breakeven approximately 2 years from now. How fast will the company have to grow each year in order to reach the breakeven point by 2026? Working backwards from analyst estimates, it turns out that they expect the company to grow 64% year-on-year, on average, which is rather optimistic! If this rate turns out to be too aggressive, the company may become profitable much later than analysts predict.

We're not going to go through company-specific developments for Rocket Lab USA given that this is a high-level summary, though, bear in mind that typically a high forecast growth rate is not unusual for a company that is currently undergoing an investment period.

One thing we’d like to point out is that The company has managed its capital judiciously, with debt making up 19% of equity. This means that it has predominantly funded its operations from equity capital, and its low debt obligation reduces the risk around investing in the loss-making company.

Next Steps:

This article is not intended to be a comprehensive analysis on Rocket Lab USA, so if you are interested in understanding the company at a deeper level, take a look at Rocket Lab USA's company page on Simply Wall St. We've also put together a list of essential aspects you should further examine:

1. Valuation: What is Rocket Lab USA worth today? Has the future growth potential already been factored into the price? The intrinsic value infographic in our free research report helps visualize whether Rocket Lab USA is currently mispriced by the market.
2. Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on Rocket Lab USA’s board and the CEO’s background.
3. Other High-Performing Stocks: Are there other stocks that provide better prospects with proven track records? Explore our free list of these great stocks here.

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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.