Rocket Lab Gains 2.2% in the Past 3 Months: Should You Buy the Stock?

Shares of Rocket Lab USA, Inc. RKLB have gained 2.2% in the past three months, surpassing the 1.1% growth of the Zacks Aerospace-Defense Equipment industry. It, however, underperformed the Zacks Aerospace sector’s growth of 3.7% and the S&P 500’s rise of 7.9%.

Other defense equipment stocks, such as AAR Corp. AIR and Curtiss-Wright Corporation CW, have also outperformed the industry in the past three months. Shares of AIR have gained 6.3%, while shares of CW have gained 12.1%.

With RKLB’s recent gains on the bourses, some investors may consider buying the stock right away. However, before taking any decision, it is important to understand the reasons behind this robust performance. Does the company have what it takes to continue this momentum, or are there risks that may affect its growth? The idea is to help investors make a more insightful decision.

Tailwinds for RKLB

RKLB’s recent performance appears to be supported by its strong quarterly results, notable milestones and contract wins, which have helped sustain investor confidence. In November, the company reported its third-quarter 2025 results, showing revenue growth of 48% and an improvement in net losses compared with the same period last year.

In November 2025, Rocket Lab achieved an important milestone as its two Explorer-class spacecraft for NASA and the University of California, Berkeley’s Space Sciences Laboratory were successfully launched for the ESCAPADE mission to Mars. The spacecraft will study the planet’s magnetosphere, highlighting Rocket Lab’s growing role in supporting deep-space science.

In the same month, Rocket Lab completed its 74th Electron mission, deploying a satellite to orbit for the Institute for Q-shu Pioneers of Space (iQPS). This marked the company’s sixth dedicated launch for iQPS, reinforcing its position as the primary launch partner for the Earth-imaging constellation. The mission further demonstrated the reliability of the Electron rocket and Rocket Lab’s continued leadership in responsive small-satellite launches.

In October 2025, Rocket Lab completed the Systems Integration Review and finalized its Photon spacecraft for Eta Space and NASA’s LOXSAT mission. The mission will test cryogenic fluid management in orbit, providing data for the future Cryo-Dock propellant depot planned for 2030.

Looking ahead, RKLB is preparing for the first launch of the Neutron rocket, which is expected in the second half of 2025. This should significantly expand Rocket Lab’s launch capacity in the United States and will help it move beyond small satellite launches to compete with larger players in the space industry.

Risks to Consider Before Choosing RKLB

Rocket Lab shows strong growth potential in the near term, but investors should also keep in mind some important risks. One key concern is the company’s high operating costs. Rocket Lab continues to spend heavily on the development of advanced technologies, such as the Neutron rocket, satellite platforms and other space systems. These expenses often exceed revenue growth and have resulted in ongoing losses in recent quarters and might also continue to do so in the near term.

RKLB’s Near-Term Estimates

The Zacks Consensus Estimate for RKLB’s 2025 revenues indicates a solid improvement of 36% from the prior-year level. The estimate for its earnings also indicates a solid improvement from the prior-year quarter.

The upward revision in its 2025 earnings estimate over the past 60 days reflects increasing analysts' confidence in its earnings growth prospects.

RKLB Shares Trading at a Premium

RKLB shares are trading at a premium, with its forward 12-month Price/Sales (P/S F12M) being 26.59X compared with its industry’s average of 9.28X.

Its industry peers, AIR and CW, are trading at a discount in comparison with RKLB. AIR is trading at a P/S F12M of 0.98X, while CW is trading at a P/S F12M of 5.57X.

Conclusion

Investors interested in RKLB should wait for a better entry point, considering its premium valuation and the persistent high operating costs. However, those who already own this Zacks Rank #3 (Hold) stock may choose to maintain their positions, taking into account its solid long-term prospects, performance at the bourses and strong sales growth expectations.

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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