As we venture into June 2024, the space industry continues to capture the imagination of investors and enthusiasts alike. With the global space economy projected to triple to $1 trillion by 2040, the potential for growth is immense. Innovation in this sector is also expected to grow. In this article, we will delve into three of the best space stocks that are making waves in the industry.
Each of these companies brings a unique perspective and approach to the space sector, from established aerospace giants to emerging players pushing the boundaries of space exploration and commercialization. We will examine their financial performance, strategic initiatives, and future prospects, providing valuable insights for investors seeking to capitalize on the exciting opportunities in the space industry.
So here are three of the best space stocks to buy in June. These stocks may not stay cheap for long, so taking urgent action is advisable for investors interested in this industry.
Lockheed Martin (LMT)
Lockheed Martin (NYSE:LMT) remains a compelling buy in June 2024, despite recent turbulence in its stock price.
The company’s Space segment, which saw a 10% increase in sales to $3.27 billion in Q1 2024, focuses on satellites, space probes, and deep space exploration. Lockheed Martin is a key contractor for NASA, contributing to missions like the Artemis program.
The aerospace giant reported robust financial performance with net sales of $17.2 billion. This translates to an EPS of $27.31 year-to-date. The company boasts a profit margin of 9.73% and an impressive return on equity of 83.2%.
Lockheed Martin’s strategic focus on high-growth sectors is evident in its $4.1 billion contract with the U.S. Missile Defense Agency for hypersonic threat tracking. Furthermore, its aeronautics unit saw significant gains, largely due to the F-35 program, contributing to a $735 million increase in sales.
Lockheed projects sustained production rates and a positive revenue trajectory, with a forecasted increase to $78.61 billion by 2028. Analysts have set a target price of $489.10, signaling strong upside potential for LMT.
Rocket Lab USA (RKLB)
Rocket Lab USA (NASDAQ:RKLB) is an emerging player in the space sector. It is tapping into the global space economy’s potential growth, which is projected to triple to $1 trillion by 2040.
Despite financial challenges, Rocket Lab’s strategic position makes it a compelling space stock in June 2024. The company reported Q1 2024 revenue of $93 million, although it currently has an EPS of -$0.37.
Rocket Lab’s recent $515 million U.S. government contract for designing and operating space vehicles is something to note. The contract involves designing, manufacturing, delivering, and operating 18 space vehicles, with a base amount of $489 million and potential incentives of $26 million. The company has successfully launched 42 Electron rockets and continues to demonstrate technological advancements.
With an analyst target price of $7.57 and a 52-week high of $8.05, Rocket Lab offers upside for growth-oriented investors.
Virgin Galactic (SPCE)
Virgin Galactic (NYSE:SPCE), headquartered in Las Cruces, New Mexico, is an aerospace company focused on developing manned spaceflight for private individuals and researchers.
As of March 31, 2024, the company reported a loss of 25 cents per share and revenue came in at 2 million. With a market capitalization of $347.9 million and shares outstanding totaling 411.4 million, SPCE faces financial challenges, reflected in its negative EPS of -$1.17.
Despite the company’s efforts, including plans to produce larger Delta-class ships and price tickets at $450,000 per seat, profitability remains elusive. The decision to raise $400 million through a common stock sale caused an 18% share price drop, underlining investor concerns.
With a price to sales ratio of 63.54 and a book value of $1.03, Virgin Galactic’s high volatility and uncertain financial trajectory pose substantial risks, necessitating careful consideration for potential investors.
Still, despite these concerns, SPCE could be one of the best pure-play space stocks for investors to consider adding to their portfolios thanks to its tiny valuation at just 85 cents per share.
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.
