Rocket Lab Corporation (NASDAQ:RKLB) Just Reported And Analysts Have Been Lifting Their Price Targets

A week ago, Rocket Lab Corporation (NASDAQ:RKLB) came out with a strong set of third-quarter numbers that could potentially lead to a re-rate of the stock. Revenues and losses per share were both better than expected, with revenues of US$155m leading estimates by 2.2%. Statutory losses were smaller than the analystsexpected, coming in at US$0.03 per share. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.

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Taking into account the latest results, the current consensus from Rocket Lab's 14 analysts is for revenues of US$892.2m in 2026. This would reflect a huge 61% increase on its revenue over the past 12 months. Losses are predicted to fall substantially, shrinking 45% to US$0.20. Before this latest report, the consensus had been expecting revenues of US$905.1m and US$0.19 per share in losses. So it's pretty clear consensus is mixed on Rocket Lab after the new consensus numbers; while the analysts held their revenue numbers steady, they also administered a modest increase to per-share loss expectations.

See our latest analysis for Rocket Lab

Although the analysts are now forecasting higher losses, the average price target rose 9.9% to 58.66667, which could indicate that these losses are expected to be "one-off", or are not anticipated to have a longer-term impact on the business. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. Currently, the most bullish analyst values Rocket Lab at US$83.00 per share, while the most bearish prices it at US$50.00. Analysts definitely have varying views on the business, but the spread of estimates is not wide enough in our view to suggest that extreme outcomes could await Rocket Lab shareholders.

Of course, another way to look at these forecasts is to place them into context against the industry itself. We can infer from the latest estimates that forecasts expect a continuation of Rocket Lab'shistorical trends, as the 46% annualised revenue growth to the end of 2026 is roughly in line with the 45% annual growth over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenues grow 8.4% per year. So it's pretty clear that Rocket Lab is forecast to grow substantially faster than its industry.

The Bottom Line

The most important thing to note is the forecast of increased losses next year, suggesting all may not be well at Rocket Lab. Happily, there were no major changes to revenue forecasts, with the business still expected to grow faster than the wider industry. We note an upgrade to the price target, suggesting that the analysts believes the intrinsic value of the business is likely to improve over time.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have estimates - from multiple Rocket Lab analysts - going out to 2027, and you can see them free on our platform here.

We don't want to rain on the parade too much, but we did also find 2 warning signs for Rocket Lab that you need to be mindful of.

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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.