Space exploration is big business and getting bigger. The market for space exploration is valued at about $500 billon today but is forecast to reach $1.88 trillion by 2032, according to market research firm Spherical Insights. From ferrying astronauts and supplies to the International Space Station and taking images of distant planets, to planning for a return to the Moon and preparing a human mission to Mars, space is a fast growing sector for both governments and private sector companies around the world.
As such, there are many publicly traded companies involved in exploring our solar system that investors can take a position in. While many of these companies are start-ups, others are mature concerns and well-known names. The bottom line is that there is no shortage of stocks investors can purchase to gain exposure to the cutting-edge space industry.
Here are three space stocks to invest in for the next era of exploration.
Planet Labs (PL)
Planet Labs (NYSE:PL) is a unique company that has great potential. It has developed technology that images the entirety of the Earth each day. The company uses a constellation of satellites to essentially photograph the entire planet every 24 hours and monitor changes that are taking place and identify patterns. This technology can be used by governments and private sector companies to accomplish tasks ranging from spotting weather patterns and predicting crop yields to tracking military movements in various places around the world.
While the potential is great, Planet Labs has struggled, mainly because the company is an unprofitable start-up. It also faces high capital expenditures to both maintain its current satellite network and develop ever more powerful earth imaging technologies. Consequently, PL stock has fallen nearly 50% year-to-date and is down 77% since it went public in 2021 via a special purpose acquisition company (SPAC). The shares currently trade in penny stock territory.
While not without risk, PL stock could make for a good long-term investment for people who have patience and don’t mind waiting for a start-up company to grow and mature.
Northrop Grumman (NOC)
Northrop Grumman (NYSE:NOC) is mostly known as a defense contractor and one of the world’s largest weapons manufacturers. However, the company is also a major contributor to the space sector. Northrop Grumman helped to develop the James Webb Space Telescope that is taking far off images of the galaxy; developed the rocket boosters for NASA’s Space Launch System; and its technology can be found throughout the International Space Station that is orbiting the earth.
Northrop Grumman’s foray into space dates all the way back to the Apollo Moon landing in 1969. Of course, Northrop Grumman is much more than a space company, with multiple business units that, combined, generate $36 billion in annual revenues and employ 95,000 people worldwide.
Like other defense companies, NOC stock has slumped this year, declining 8% since January. However, over five years, the company’s share price is up 60%. And it pays a nice dividend of $1.87 per share each quarter for a yield of 1.51%.
Boeing Co. (BA)
Boeing Co. (NYSE:BA) is another company that plays a big role in space, often with little fanfare. While Boeing is mostly known for the commercial aircraft it makes, it too has a sizable space division that is focused on both satellites and space aircraft. Through its partnerships with NASA and the U.S. government’s Space Force, Boeing is involved in work that it hopes will eventually lead to a future mission to Mars. The company says it is developing propulsion systems that will make deep space exploration by humans possible.
Today, Boeing’s space unit generates more than $20 billion in annual revenues, representing about 15% of the company’s total annual revenue. Like the other names on this list, Boeing’s stock has had a rough go of it this year, falling 4% year-to-date. The decline in the share price has mostly been due to issues that have arisen on the commercial aircraft manufacturing side of the business. While those issues are likely to be resolved, they don’t take away from the strides Boeing is making within the space sector.
On the date of publication, Joel Baglole 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.com Publishing Guidelines.