If You Had Invested $1,000 in Rocket Lab's Shares Three Years Ago, This Is Your Current Worth
Rocket Lab (RKLB up 14.42%) has been among the top performers on the Nasdaq in 2024, increasing by over 380% since the year started.
This is impressive, but what has the experience been like for long-term investors in Rocket Lab? For those who purchased the stock in December 2021 and held on during the subsequent turbulence, the return on their investment in this prominent space sector stock hasn't been as astounding.
Improving finances and a swelling pipeline
Following its merger with a special purpose acquisition company (SPAC), Rocket Lab began trading on the public markets on August 21, 2021. An investor who waited a few months after the stock's Nasdaq debut and bought $1,000 worth of shares on December 14, 2021, would've witnessed a decrease of over 80% in the value of their investment over the subsequent periods. However, in the spring of 2024, the stock finally started to recover. With its rebound, that $1,000 investment, made three years ago, would currently be worth around $2,600 as per the market prices from Tuesday.
Although Rocket Lab remains in the red, investors have applauded the company's success in increasing sales over the past two years as well as achieving profitability on a gross profit basis. These are two positive indications that this growth-focused company is, indeed, expanding.
Moreover, investors have boosted the stock's value due to their confidence in Rocket Lab's potential for continued revenue growth. By the end of the third quarter, it had a pipeline of orders worth $1.05 billion, a 80% hike compared to the same period last year.
Should one jump aboard with Rocket Lab now?
Given that Rocket Lab is in the red, it's challenging to evaluate the stock using profit-centric valuation metrics such as P/E ratio. Additionally, with the stock trading near its all-time high, investors might be hesitant to click the "buy" button. Nevertheless, the company's revenue and gross profit growth deserve recognition, and its growing pipeline suggests that clients are eager to utilize Rocket Lab's services for the deployment of space-based assets. Consequently, Rocket Lab is certainly worth considering for growth investors interested in including space sector stocks in their portfolios.
Investors who are interested in the space sector might consider adding Rocket Lab to their portfolios, given its impressive revenue and gross profit growth. Further, with a pipeline of orders worth $1.05 billion, an 80% increase from the previous year, Rocket Lab seems to have a strong financial foundation for future money-making opportunities in finance.
Despite the current stock's trading near its all-time high, long-term investors who bought Rocket Lab shares in late 2021 have seen significant returns on their investment. For instance, an investor who purchased $1,000 worth of Rocket Lab stock on December 14, 2021, would now have around $2,600 in their account, reflecting the stock's value as of Tuesday.
