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Why Is RocketLab Stock Crashing, and is it a Buying Opportunity? | RKLB Stock Analysis

Parkev Tatevosian, CFA•Aug 13, 2026

Summary

Parkev analyzes Rocket Lab's latest quarterly results, noting that the company achieved record revenues of $234 million, representing 62% year-over-year growth. Parkev emphasizes that the company's fundamentals are improving, with net losses narrowing to $49 million and a backlog that surged 137% to a record $2.36 billion. Parkev also highlights significant new contracts, including a $397 million deal with the US Space Force for satellite delivery.

Despite these positive business developments, Parkev focuses on a major disconnect between the company's performance and its market valuation. Parkev explains that the 7% post-earnings stock drop was a necessary valuation correction because the bar for success was set too high. Parkev notes that a forward price-to-sales ratio of 36 is exceptionally high compared to historical levels and the broader market, especially since growth is expected to slow from 54% this year to 32% by 2028.

RKLB: Parkev maintains a hold rating on Rocket Lab, citing that while the technology is world-class, the stock price is nearly four times Parkev's estimated fair value. Parkev calculates the fair value of the shares to be approximately $22 based on a discounted cash flow (DCF) model, whereas the stock currently trades around $80. Parkev suggests that the current market price reflects extreme momentum and popularity rather than underlying intrinsic value.
SpaceX: Parkev compares Rocket Lab to SpaceX, noting that many investors are drawn to the space sector following the SpaceX IPO. Parkev states that SpaceX's valuation is even more expensive than Rocket Lab's, though SpaceX's valuation includes an artificial intelligence component. Parkev expresses a preference for Rocket Lab over SpaceX at current market prices, even though Parkev considers both to be overvalued.

Mentioned Stocks

RKLB
Sentiment: HOLD

Reasoning: Parkev states that Rocket Lab is an exceptionally innovative company that reported record revenues and a massive backlog growth. However, Parkev maintains a HOLD rating because the valuation is extremely high, trading at a forward price-to-sales ratio of 36. Parkev calculates a fair value of approximately $22 per share using a discounted cash flow model, which is significantly lower than the current market price of roughly $80.

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