Is Rocket Lab USA (NASDAQ:RKLB) about to blast off? One firm thinks so. Cantor Fitzgerald recently issued a bullish take on RKLB stock, naming it as a potential winner of the new space race. The penny stock is still recovering from a difficult year, but it has been showing signs of a turnaround in 2024. Now it seems that Wall Street is noticing, which may provide exactly the boost that RKLB needs to permanently shake off the problems it has faced. Even after last month’s launch failure, Rocket Lab is in a good position as it prepares for a new year.
Cantor Fitzgerald’s upgrade isn’t the only good news for Rocket Lab investors, though. Yesterday also brought a highly encouraging update; the Federal Aviation Administration (FAA) has cleared it to resume launches. If there are no further complications, RKLB could be a 2024 breakout stock as it sends more rockets into space.
RKLB Stock Is Cleared for Takeoff
These positive updates have created some excellent momentum for RKLB stock today. As of this writing, it is up 4.5% for the day and looks primed to continue rising. After a highly volatile week, the company is finally demonstrating the type of growth that investors want to see. The prospect of further launches in the fairly near future could be enough to keep it going, taking RKLB above the penny-stock level.
Despite the in-flight anomaly on Sept. 19, Cantor Fitzgerald is more focused on Rocket Lab’s successes than its failures. In a note to investors, the company’s analysts stated that they believe “RKLB benefits from a proven and successful launch track record, a diversified and recurring customer base, and multiple launch complexes with vertical integration.” On top of all that, the stock still trades at less than $5 per share, which could create a tempting point of entry for investors who don’t mind some risk.
Investors can also take comfort in the fact that Rocket Lab’ launch license is still active, as confirmed by the FAA. This is an important step for the company as it maneuvers to ensure that its problems from the September launch do not persist. Founder and CEO Peter Beck issued the following statement:
“After more than 40 launches, Electron is a proven, mature design with a well-established manufacturing process behind it, so we knew the fault was going to be something complex and extremely rare that hasn’t presented in testing or flight before. Our investigation team with FAA oversight has worked around the clock since the moment of the anomaly to uncover all possible root causes, replicate them in test, and determine a path for corrective actions to avoid similar failure modes in future.”
What Comes Next
There’s a key takeaway from the recent FAA news that investors should keep in mind. As InvestorPlace contributor Matthew Farley recently noted, expecting every single launch a company like Rocket Labs attempts to succeed is not realistic. The market overreacted to the September incident, but now the company has shown it can take the necessary steps to correct errors.
To dismiss RKLB stock as a space race standout simply because of one launch failure would be a mistake. As Cantor Fitzgerald noted, the company’s track record is ultimately one of success. When Rocket Labs demonstrates its capabilities to investors in the near future, it will likely send shares shooting up.
On the date of publication, Samuel O’Brient did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.comPublishing Guidelines.
