3 Once-in-a-Lifetime Space Exploration Stocks With Unprecedented Surge Potential


  • Each of the space stocks below is a strong buy.
  • Telesat (TSAT): Is launching a new satellite constellation
  • Virgin Galactic (SPCE): Seems undervalued with huge growth prospects.
  • Lockheed Martin (LMT): Is making serious strides in satellite technology.
Space Exploration Stocks - 3 Once-in-a-Lifetime Space Exploration Stocks With Unprecedented Surge Potential

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Space exploration stocks represent the new frontier. These companies are pushing the boundaries of satellite technology, human spaceflight missions, and the exploration of Mars to help us potentially become a space-faring civilization.

With space exploration stocks, I don’t believe their upside is fully priced into their current valuations. At its core, space flight is inherently speculative in its very earliest stages. Additionally, it’s difficult for investors to grasp the complex subject matter.

But for those who seek gains in their growth portfolios, these companies could be a viable option. Indeed, some show unprecedented surge potential to increase their valuations further.

Telesat (TSAT)

A photo of a satellite over earth.
Source: AlexLMX / Shutterstock

Telesat (NASDAQ:TSAT) is a leading global satellite operator that provides exceptional communications solutions.

Now could be an excellent time to consider a position in TSAT stock. It’s launching its broadband satellite constellation called Lightspeed. And, it is expected to be operational sometime in late 2027. 

Also, satellite constellations are nothing new, as companies like SpaceX and nation-states have had their own constellations for decades. But TSAT’s initiative is fully funded, with some of that capital coming directly from the Canadian government. This indicates a minimal risk of shareholder dilution in the foreseeable future. The constellation is expected to be highly accretive from a cash flow position.

Investors anticipate the company’s EBITDA to increase from $400 million in 2028 to $2.7 billion by 2032.

In the short term, its shares are also cheap, trading at just 0.81 times earnings and 0.18 times sales. It’s surely one of those space exploration stocks that investors should keep a close eye on.

Virgin Galactic (SPCE)

Virgin Galactic (SPCE) banner hanging on the New York Stock Exchange building to celebrate its IPO.
Source: Christopher Penler / Shutterstock.com

Virgin Galactic (NYSE:SPCE) is a spaceflight company within the Virgin Group. It is developing commercial spacecraft and aims to provide recreational spaceflights affordable to space tourists. Those include billionaires and non-billionaires alike.

SPCE is my contrarian pick for investors wanting to buy potentially undervalued space exploration shares. The reason I believe SPCE is undervalued is due to comments made by Virgin Group’s founder, Richard Branson. He stated that he wouldn’t be investing more in the company. Consequently, the stock’s price fell by 15% the same day.

Despite the market’s reaction, SPCE has sufficient liquidity in the short term, with a net cash position of $617.77 million or $1.55 per share. However, analysts have raised the possibility that SPCE could need to raise funds to support its operations. Already, it burned through $514.25 million worth of cash in the last twelve months.

There’s a dramatic difference between its trailing 12-month and forward price-to-sales ratios, which stand at 157.91 and 44.12, respectively. This means SPCE stock could be relatively undervalued based on this metric. Also, despite the short-term dilution fears, SPCE is expected to enormously increase its top line in FY2026, with a 3,013.21% predicted increase, bringing its revenues to $168.30 million.

Therefore, Virgin Galactic is undeniably speculative, but the potential upside is there for risk-averse investors.

Lockheed Martin (LMT)

A Lockheed Martin (LMT) Space Systems sign in Sunnyvale, California.
Source: Ken Wolter / Shutterstock.com

Lockheed Martin (NYSE:LMT) is a global aerospace, defense, and security company with a keen interest in space technology.

LMT is making numerous endeavors into the intersection of defense and spaceflight. Most notably, it opened its Operations Center of the Future, a technology test bed located near Denver, Colorado.

The company is enabling operators to review and manage multiple space missions using the cloud. This represents a significant step forward in LMT’s involvement in space flight and will be an undeniably useful tool for satellite operators and engineers.

Going hand in hand with this new operations center is the opening of its dedicated factory for producing small satellites. The facility can produce up to 180 small satellites annually. It’s part of a broader trend of customers preferring these sleeker models over larger and more expensive ones.

Also, Lockheed Martin seems undervalued with its P/E ratio of just 15.6 times earnings, which means that investors may be able to reap substantial gains from these developments.

On the date of publication, Matthew Farley did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

Matthew started writing coverage of the financial markets during the crypto boom of 2017 and was also a team member of several fintech startups. He then started writing about Australian and U.S. equities for various publications. His work has appeared in MarketBeat, FXStreet, Cryptoslate, Seeking Alpha, and the New Scientist magazine, among others.

Article printed from InvestorPlace Media, https://investorplace.com/2024/01/3-once-in-a-lifetime-space-exploration-stocks-with-unprecedented-surge-potential/.

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