Rocket Lab Stock: Weathering the Storm, Time for a Comeback?

Key Points

• Rocket Lab shows relative strength, holding above its 200-day SMA despite a sharp 2025 selloff, suggesting potential leadership in a future market rebound.
• Recent strategic wins and expansion, including a stake in Mynaric, multiple successful launches, and eligibility for a $5.6B DoD contract, reinforce Rocket Lab’s long-term growth potential.
• Investor sentiment remains mixed, with a Moderate Buy rating and 16% upside potential, but elevated short interest reflects ongoing skepticism amid market uncertainty.

Rocket Lab USA Inc. NASDAQ: RKLB, a mid-cap name in the aerospace and defense sector, surged to new heights in 2024, gaining widespread popularity among growth investors. But like much of the broader market in 2025, it has faced a volatile start to the year. Shares are down nearly 23% year-to-date and over 40% below their 52-week highs. However, there’s more to the story than just a price drop.

Despite the recent selloff, Rocket Lab has shown surprising resilience. While many major tech giants, including the Magnificent Seven, have broken below their 200-day simple moving averages (SMA), RKLB continues to hover above this critical technical level, signaling potential strength beneath the surface.

Technical Strength Holding Up

While it’s clear the stock has faced selling pressure in 2025, the broader trend remains encouraging when viewed on a multi-year chart. RKLB recently pulled back to its 200-day SMA around the $15 level, an area that aligns with previous resistance from 2022, a gap-fill from earnings in late 2024, and now, key support during the 2025 correction and bear market.

This confluence of support suggests that if the stock can hold above $15 and its 200-day moving average, it could signal a reacceleration of bullish momentum once broader market sentiment improves. If RKLB consolidates above this level while the rest of the market remains under pressure, it may position itself as a relative strength leader when the next bull market begins.

Momentum from Recent Developments

Beyond technicals, many favorable developments have reinforced Rocket Lab’s longer-term potential. On March 15, the company successfully launched its 61st Electron mission from Mahia, New Zealand, deploying a satellite for Japanese client iQPS.

This mission marked Rocket Lab’s second for iQPS and is part of a larger agreement for six launches in 2025 and two more in 2026.

Just days later, Rocket Lab announced a quick-turnaround mission for OroraTech, a German wildfire detection firm. It highlighted its operational efficiency with a scheduled launch four months after contract signing.

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The most significant news came on March 11, when Rocket Lab revealed its acquisition of a majority stake in Mynaric AG, a German firm specializing in laser-based satellite communications, for $75 million, with an additional $75 million possible based on performance targets.

The move gives Rocket Lab a foothold in Europe. It expands its capabilities in optical satellite communication, aligning with a $515 million U.S. Space Development Agency contract that Mynaric already supports.

Additionally, Rocket Lab scored a significant win on March 27, when the U.S. Department of Defense awarded its National Security division a spot on a $5.6 billion indefinite-delivery/indefinite-quantity (IDIQ) launch contract.

While this doesn’t guarantee immediate revenue, it positions Rocket Lab to compete alongside SpaceX, Blue Origin, and ULA for future national security missions using its upcoming Neutron rocket.

Sentiment Remains Divided, But Potential Is Growing

As is often the case with early-stage, high-growth companies, sentiment around Rocket Lab remains mixed. The company is still unprofitable and chasing market share in a sector dominated by giants like SpaceX. Yet its growth trajectory, strategic contracts, and expanding capabilities have earned it growing respect from analysts and retail investors.

According to twelve analyst ratings, RKLB currently holds a Moderate Buy rating and an average price target of $22.72, nearly 16% upside from Thursday’s close. Notably, that target jumped dramatically from just $7.46 a year ago, reflecting how much has changed for the company from a growth and operational perspective. On the other hand, short interest remains elevated, with 15.7% of the float still held short, down from over 20% in Q4 2024.

Still, a sign of skepticism persists, and investors might want to tread cautiously while the market remains increasingly volatile.