Launch vehicle services provider Astra Space (NASDAQ:ASTR) has a less-than-ideal track record when it comes to successful launch attempts. Also, ASTR stock has been a poor performer and the company appears to be losing money. Therefore, investors can be cautious and choose not to invest in Astra Space.
Don’t get the wrong message here. It’s fine to get excited about the prospect of space flight. When rocket launches are successful, they can inspire people’s hopes and dreams.
Yet, sensible investors must always be mindful of a company’s financials. This is particularly true when it comes to Astra Space, which doesn’t have a great track record of successful launches, and also isn’t a profitable business venture.
What’s Happening with ASTR Stock?
Sometimes people talk about a “hard landing” with the Federal Reserve’s balance sheet roll-off and interest rate hikes. As InvestorPlace contributor Josh Enomoto observed, “Unfortunately, rising borrowing costs impose pressure on growth-oriented investments like ASTR stock.”
That’s not the only hard landing that’s in progress, though. The Astra Space share price has fallen fast in 2022 so far, declining from nearly $7 to less than $1. There were quick rallies along the way, but they were sold off promptly and mercilessly.
It certainly didn’t help the ASTR stock bulls when Astra Space’s mid-June launch of rocket LV0010, carrying “two satellites on NASA’s TROPICS-1 mission” according to CNBC, failed to reach orbit.
That report, unfortunately, noted that this failed mission represented Astra Space’s “second mission failure in three launches this year” at that time. Thus, even if you’re optimistic about U.S. space travel in general, don’t forget about Astra Space’s less-than-stellar track record.
Astra Space’s Financials Are Problematic
Fast-forward to August, and CNBC reported that Astra Space paused its rocket launches until at least 2023. That’s another blow to the ASTR stock bulls, no doubt.
Also in August, Astra Space reported its second-quarter 2022 fiscal results. Bear in mind, you’re not just investing in a dream here. Holding a stock means investing in a business, and if the business has financial issues, that’s a major problem.
In Q2 2022, Astra Space incurred an $82.3 million net earnings loss. That’s a whole lot worse than the already dismal $31.3 million net loss from the year-earlier quarter.
Moreover, Astra Space sustained an adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) loss of $48.4 million in 2022’s second quarter. For Q3 2022, the company anticipates an adjusted EBITDA loss between $45 million and $51 million. So, don’t expect much if any improvement in that area.
What You Can Do Now
What does Astra Space offer its investors? A dream, maybe. However, the company doesn’t offer a highly successful flight track record, or a profitable financial profile.
Besides, ASTR stock has punished its investors for too long already. Why hold on to such a poor performer, or start a new position in it? It’s best to keep your distance, and watch the hard landing from afar.
On the date of publication, neither Louis Navellier nor the InvestorPlace Research Staff member primarily responsible for this article held (either directly or indirectly) any positions in the securities mentioned in this article.