QS Research · Michael Burry's Scion Capital analyst template · 2006
Rocket Lab Corp (RKLB)
As of 2026-11-08 · 13/15 boxes filled from SEC filings and market data
Conclusion: WATCH
Conviction low · base case none · downside -68% · upside +93%
The market is paying 38.31x EV/Sales and 41.29x P/S for a TTM revenue base of $769.1M that still produces EBIT of -$223.5M, EBITDA of -$161.1M and free cash flow of -$371.1M. At today's 38.31x EV/Sales, the base-case value is $53.07, exactly the 2026-11-06 close; downside to Firefly's 10.02x on the same revenue is $16.71, or -68.5%, while upside requires revenue to roughly double to $1.54B at the same multiple to reach $102.32, or +92.8%. The Q3 2026 print, Neutron pad delivery and Iridium deal are real catalysts, but they do not yet solve the lack of earnings power or the financing/integration risk. I would watch, not buy: the multiple leaves no margin of safety, and the short rule is not met because the same-multiple upside is too large.
Key numbers
- Share price: $53.07
- Market cap: $31.75B
- Latest financial period: TTM to Jun 30, 2026
- Revenue (TTM): $769.1M
- Price / book: 9.09x
The 15 boxes
- ✓ 1. Long-form business notes
Rocket Lab is an end-to-end space company with Launch Services (Electron/HASTE, Neutron in development) and Space Systems (components, spacecraft, optical systems). FY2020-FY2025 revenue grew from $35.2M to $601.8M and gross profit turned from -$11.8M to $207.2M, but FY2025 operating income was -$228.8M, net income -$198.2M, operating cash flow -$165.5M and capex $156.3M. The oldest annual report provided is a blank-check 10-K, so it gives no operating-business baseline; sources do not disclose segment revenue/margins or launch-level pricing.
- ✓ 2. Competitive advantage
On the only evidence in these sources (FY2020-FY2025 XBRL, the FY2025 10-K filed 2026-02-26), Rocket Lab has a real product position in small launch and space systems but no demonstrated durable advantage in the numbers: gross profit turned positive (from -$11.8M in FY2020 to $207.2M in FY2025) while operating income stayed negative every year and widened to -$228.8M in FY2025, with operating cash flow negative in all six years. Competition is broad and better capitalised - SpaceX, ULA, Northrop, Firefly, Blue Origin in launch; Airbus, Lockheed, Boeing, Maxar, L3Harris in spacecraft; Ball, Raytheon, Honeywell, Redwire, Beyond Gravity in components - and the 10-K itself concedes most rivals are larger with substantially greater resources. Customer concentration (top five = ~49% of FY2025 revenue) and U.S. government dependence (~47% of FY2025 revenue, much of it fixed-price) argue against pricing power. All figures here are FY2025 or older; no Q3 2026 or TTM data appears in these sources.
- ✓ 3. 10-Q takeaways
Q2 2026 (quarter ended 2026-06-30) was Rocket Lab's record revenue quarter: $234.1 million, +62% year over year, with space systems up 94% to $189.5 million while launch services slipped 4% to $44.6 million on revenue-recognition timing. Gross margin improved to 36.1% (32.1% in Q2 2025), but the business is still not profitable: operating loss was $(57.5) million and net loss $(49.3) million, the net figure helped by $16.5 million of interest income and interest expense down to $0.6 million. Backlog reached $2,355.9 million at June 30, 2026 and management guided Q3 2026 to $250-265 million of revenue with an Adjusted EBITDA loss of $17-23 million, while committing to a ~$8.0 billion enterprise-value Iridium acquisition funded partly by a $3.6 billion committed bridge facility.
- ✓ 4. Corporate governance
Filled; members read this box.
- ✓ 5. Overview of the prior 3 years of 8-K filings
Filled; members read this box.
- ✓ 6. Other significant filings
Filled; members read this box.
- ✓ 7. Chronology of significant news and events
Filled; members read this box.
- ✓ 8. Comparables valuation interpretation
Filled; members read this box.
- ✓ 9. Insider trading interpretation
Filled; members read this box.
- ○ 10. Earnings-call notes
- ✓ 11. Impression of the shareholder letter
Filled; members read this box.
- ○ 12. Scuttlebutt overview
- ✓ 13. Valuation and risk/reward summary
Filled; members read this box.
- ✓ 14. Current price suppression and potential catalysts
Filled; members read this box.
- ✓ 15. Conclusions
The call above.
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