The space sector and other speculative avenues have fallen out of favor with investors in the past couple of years, but there are still potential multibagger space stocks. Sector bellwethers such as Virgin Galactic (NYSE:SPCE) have lost nearly all the gains made during the peak in 2021. Moreover, given the market uncertainty, it’s tough for investors to consider multibagger space stocks.

Space stocks went parabolic in 2021, fueled by several high-profile events and significant advancements. One of the major growth drivers was the influx of private space firms going public through shell companies, offering a quicker IPO alternative. Prominent players such as Virgin Galactic saw their stock climb to an all-time high of $59.41. In comparison, SPCE stock now trades at just 75 cents, roughly 99% lower than its all-time high price. 

The initial frenzy has subsided, and investors are now seeking tangible results over hype. However, space stocks hold significant upside potential in the long run, offering substantial rewards for those willing to embrace risk.

Multibagger Space Stocks: Rocket Lab USA (RKLB)

Rocket Lab USA (NASDAQ:RKLB) is one of the most active and promising companies in the space niche. Through its launch services and satellite solutions, it plays a key role in advancing space exploration and technology. Moreover, unlike its peers, it has consistently delivered on its promises and is poised to become a major needle-mover for the space economy.

It recently launched its 45th Electron rocket from its New Zealand launch site, bringing its total deployed satellites to 181. Moreover, a couple of additional satellites are slated for deployment later this month, a testament to its incredible progress. 

Furthermore, the company is poised for robust growth ahead, with key contracts including a $525 million deal with the Space Development Agency and a $14.5 million contract from the U.S. Space Force. These agreements reinforce its the Defense Department’s top small launch vehicle provider position. Also, the firm plans to enhance its offerings further by developing its next-generation reusable launch that could significantly reduce costs.

ARK Space Exploration & Innovation ETF (ARKX)

The space sector is super speculative at this point, and perhaps the ARK Space Exploration & Innovation ETF (CBOE:ARKX) makes the most sense for those looking to invest in the industry. Moreover, the fund is led by Cathie Wood’s firm, a maverick stock picker that specializes in disruptive technologies such as space. Wood’s approach involves high-risk, high-reward bets in industries that could potentially have a transformative impact. This strategy enables them to effectively tap into potential growth from advancements in aerospace, satellites, and other space-related technologies.

The ARKX ETF hasn’t had the best of track records at the stock market, though, over the past couple of years. However, its results are essentially a reflection of the risk-off sentiment in the market, with investors rotating out of speculative industries. All that could change though, especially with interest rate cuts on the horizon. Moreover, under Wood’s guidance, investors can gain exposure to the space sector through a diversified portfolio.

AST Spacemobile (ASTS)

AST Spacemobile (NASDAQ:ASTS) is a satellite service provider directly competing with entities in SpaceX’s Starlink. ASTS aims to build a satellite constellation network in space to deliver global high-speed 5G services.

The company is operating in a market poised to grow staggeringly, pointing to a robust upside for ASTS stock. According to MarketsandMarkets, the 5G space industry could rise at a compound annual growth rate (CAGR) of 65.1% from 2023 to 2028 to a whopping $3,69 billion.

Hence, there’s a massive upside to investing in ASTS; it can effectively commercialize its operations this year. It forged partnerships with some of the leading telecommunications companies, inking agreements worth $306 million. Additionally, it inked a memorandum of understanding with 40 Mobile Network Operators (MNOs) worldwide. These MNOs collectively boast over 2 billion subscribers, offering spectacular potential for AST to extend network coverage through its space-based solutions.

On the date of publication, Muslim Farooque 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.