Rocket Lab (RKLB) Valuation Analysis: Critical Questions After 55% Surge

• , reaching record highs amid growing investor confidence.
• . defense contract doubled Rocket Lab's Space Systems backlog.
• , but execution risks remain substantial.
• .
• .

Rocket Lab's remarkable stock surge has captivated investors, . This space pioneer now faces critical questions about whether its valuation properly balances explosive growth potential against significant execution risks. The company's recent $816 million defense contract win validates its strategic shift but comes alongside Neutron rocket delays that could pressure finances.

Why Has Rocket Lab (RKLB) Stock Skyrocketed Recently?

Rocket Lab's share price surge stems from multiple catalysts converging simultaneously. . Space Development Agency to build 18 missile-tracking satellites, more than doubling its Space Systems backlog. This deal positions Rocket Lab as a prime defense contractor rather than just a launch provider. Additionally, . These achievements fueled investor optimism despite lacking a single headline event, reflecting growing confidence in execution.

The stock reached its all-time high , .

Does RKLB's Valuation Reflect Future Growth or Overoptimism?

Rocket Lab's valuation presents a stark divide among analysts. , assuming rapid revenue growth, margin expansion to levels of mature tech firms, and premium earnings multiples. This projection hinges on Electron's continued success and Neutron reaching commercial scale. . Alternative discounted cash flow models , slightly below recent trading prices. . Market expectations appear elevated given the execution requirements.

What Risks Could Derail Rocket Lab's Momentum?

Neutron rocket development represents Rocket Lab's most significant near-term challenge. The medium-lift vehicle's debut slipped to mid-2026 at earliest, . Technical hurdles could push this timeline further, jeopardizing growth projections. Competition poses another threat since Neutron's 13,000-kilogram payload capacity trails SpaceX's Falcon 9, which offers 17,500 kilograms at potentially lower prices. . , . These factors leave little room for execution missteps at current valuations. The company faces significant risks that could derail its momentum.