Rocket Lab (RKLB) Stock: Record Revenue, Nasdaq-100 Entry — So Why Is It Falling?

TLDR

• RKLB stock has fallen nearly 30% from its late-May peak, currently trading around $107.98
• Q1 revenue hit a record $200.35 million, up 63.4% year-over-year, beating analyst estimates
• Rocket Lab joins the Nasdaq-100 on June 22, which could boost institutional demand
• Institutional ownership stands at 71.78%, with Capital Impact Advisors lifting its stake by 47.5%
• Wall Street’s average price target is $102.76, with a consensus “Moderate Buy” rating

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Rocket Lab has taken a hit since SpaceX’s blockbuster IPO, with RKLB dropping nearly 30% from its late-May high of around $151.00. The stock opened Thursday at $107.98, sitting above its 50-day moving average of $104.00 but well below recent highs.

Rocket Lab USA, Inc., RKLB

Despite the pullback, the underlying business is putting up strong numbers. Q1 revenue came in at $200.35 million, a record quarterly high and a 63.4% jump from the same period last year. That beat analyst expectations of $189.65 million.

Gross margins also hit a record 38.2% in Q1, pointing to improving unit economics as the business scales. The backlog now sits at $2.2 billion, giving the company solid visibility into future revenue.

Management has guided for another record quarter in Q2, continuing a streak that suggests Rocket Lab is in a genuine growth cycle rather than a one-off pop.

Defense Contracts Adding Revenue Diversity

Beyond launch services, Rocket Lab is making moves in defense. The company landed a $515 million SDA contract in 2024 to build satellites, marking its entry as a prime contractor for the U.S. government.

It also secured a $30 million deal with Anduril Industries to use its HASTE vehicle for hypersonic test launches from Launch Complex 2 in Virginia. These contracts are broadening the revenue base beyond commercial small-payload launches.

Rocket Lab’s Electron rocket remains the world’s most frequently launched small rocket, averaging 10–15 missions per year. Its nearest competitor in that segment is Galactic Energy’s Ceres-1.

Last month, the company announced its largest block-buy deal ever — five Neutron launches secured before the rocket has even flown.

Nasdaq-100 Inclusion and Institutional Interest

Rocket Lab will join the Nasdaq-100 on June 22. That’s a catalyst worth watching, as index inclusion typically drives forced buying from passive funds tracking the index.

Capital Impact Advisors increased its stake by 47.5% in Q4, adding 145,741 units to bring its total to 452,728. Overall institutional ownership now sits at 71.78%.

On the insider side, SVP Arjun Kampani sold 23,804 units at $147.43 on May 28, and insider Marvin Bradford Clevenger sold 3,500 units at $146.67 the same day. Insiders have sold $66.9 million worth of stock over the past 90 days.

Valuation remains a sticking point. RKLB trades at a forward P/S of around 68x, more than 3,500% above the sector median. That kind of multiple is typically reserved for high-margin software businesses, not hardware companies with 38% gross margins.

Neutron, the medium-payload rocket that much of the valuation appears to price in, hasn’t launched yet. A propellant tank testing failure pushed the inaugural flight back to Q4 2026, keeping execution risk on the table.

TD Cowen and Needham both raised their price targets to $120 with Buy ratings following Q1 results. KGI Securities initiated coverage on June 11 with a Neutral rating and a $105 target. The consensus average target sits at $102.76.

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