Iridium Communications Inc. provides mobile voice and data communications services and products to businesses, the United States and international governments, non-governmental organizations, and consumers worldwide. The company offers postpaid mobile voice and data satellite communications; prepaid mobile voice satellite communications; push-to-talk; broadband data; and Internet of Things (IoT) services. It also provides hosted payload and other data services, such as satellite time and location services; and inbound connections from the public switched telephone network, short message, subscriber identity module, activation, customer reactivation, and other peripheral services. In addition, the company offers voice and data solutions comprising personnel tracking devices; asset tracking devices for equipment, vehicles, and aircrafts; beyond-line-of-sight aircraft communications applications; maritime communications applications; specialized communications solutions for high-value individuals; mobile communications and data devices for the military and other government agencies, such as secure satellite handsets, as well as netted voice, messaging, and paging services; and maintenance services for the United States government's dedicated gateway. Further, it provides satellite handsets, voice and data modems, broadband data devices, and IoT data devices; various accessories for its devices that include batteries, holsters, earbud headphones, portable auxiliary antennas, antenna adaptors, USB data cables, charging units, and others; and engineering and support services. Iridium Communications Inc. sells its products and services to commercial end users through a wholesale distribution network that include service providers, and value-added resellers and manufacturers. The company was formerly known as Iridium Holdings LLC and changed its name to Iridium Communications Inc. in September 2009. Iridium Communications Inc. is headquartered in McLean, Virginia.

Iridium looks like a high-quality but already expensive business: strong margins are accompanied by a notable valuation premium. P/E of 59.9, P/S of 5.8, and P/B of 9.2 are significantly above the industry median, leaving little room for further multiple expansion without an acceleration in earnings. Even P/FCF of 16.7, while not extreme relative to the other ratios, still does not look cheap for a company with moderate revenue and profit growth. At the same time, gross margin of around 71.8% and operating margin of 23.8% remain very strong and consistently high over the years, which supports the investment case. ROE of 27.2% and return on tangible equity of 45.5% confirm a high return on capital, but ROA of 4.2% and ROI of 4.7% already look more modest and indicate limited efficiency of the asset base. Debt load is the main risk: debt/equity of 3.74 and long-term debt of 1.75 billion versus equity of 468 million mean a high dependence on borrowed financing. Liquidity, by contrast, is comfortable: a current ratio of 2.85 and a quick ratio of 2.21 reduce short-term risks. Dividend yield has fallen to zero, whereas it was previously positive, so there is currently no dividend argument for a re-rating. Revenue and gross profit are generally holding steady, but TTM net income is only 10 million and has dropped noticeably compared with the stronger quarters of last year. This suggests that the current price already reflects strong operating qualities, while earnings momentum does not support aggressive upside. As a result, the fundamental picture is rather moderately negative for a target price revision: the business is resilient, but the valuation is stretched, and the balance sheet and profitability do not provide enough reason to raise the forecast.

Iridium Communications Inc

Сильный индекс, значительно упал. Оптимистичный взгляд на свои позиции резко сменился на неуверенность.

Strong index, significantly down. An optimistic view of his position suddenly changed to uncertainty.

Слабый индекс, значительно упал. Рынок не поддерживает быков.

Weak index, significantly down. The market does not support the bulls.

Слабый индекс, незначительно упал

Iridium remains a profitable and high-margin business, but its high valuation, rising debt, and weak net income growth limit revaluation potential.

Key Points
Space Force awarded Rocket Lab a $397 million missile defense contract in August.
The new award is worth more than six months' revenue to Rocket Lab.
Rocket Lab (NASDAQ: RKLB) just keeps on stacking up wins -- and this time, literally so.
On Aug. 4, the space company announced the U.S. Space Force awarded it a $397 million contract -- one of the company's biggest wins ever -- to supply stackable "Flatellites" for the Space-Based Airborne Moving Target Indicator (SB-AMTI) program.
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What is a Flatellite, and what will it do?
Space Force describes SB-AMTI as a "resilient space-based system to detect and track airborne threats in real time" -- so missile-tracking satellites. For its part, Rocket Lab describes the Flatellite as a new satellite design intended to be manufactured in mass quantities and deployed in large numbers, stacked efficiently and integrated seamlessly into its new Neutron reusable medium-lift rocket.
Industry analysts estimate Rocket Lab could fit perhaps 16 of its 800-kilogram Flatellites onto each Neutron (with a payload capacity of 13 tons) that it launches.
What does this mean for Rocket Lab?
For years, Rocket Lab has been rolling up smaller companies in an effort to transform itself into a vertically integrated space company capable of building satellite parts, assembling them into satellites, launching them on its own rockets (which it also builds), and then operating them in orbit. It bought Sinclair Interplanetary for its star trackers in 2020, SolAero in 2022 for its solar arrays, Mynaric in 2026 for laser communications, and, most recently, promised to acquire Iridium Communications and its entire 80-satellite communications constellation for $8 billion.
The Space Force SB-AMTI contract illustrates how these integration efforts have paid off.
Government space contracts often involve multiple moving parts. One company (say, York Space or MDA Space) might be hired to build a satellite, a second company (Space Exploration Technologies or United Launch Alliance) to launch it, and sometimes a third company (Lockheed Martin or perhaps Boeing) to operate the satellites once they're in space.
That's not how this one will work. Rocket Lab will "develop, launch, and operate" all the Flatellites involved in SB-AMTI -- all on its own, vertically integrated, top to bottom. The entire $397 million of this effort will therefore go to Rocket Lab, shared with no one else, paid out to no subcontractors.
Granted, the contract announcement doesn't detail how the money will be allocated among Rocket Lab's several parts -- how much goes to the Launch Services business with its 41% gross profit margin, how much to Space Systems, which earns only 31%, or how much to any new divisions Rocket Lab might designate in the future, such as a "space services" division that provides Internet of Things (IoT) and navigation services from orbit, or a "Rocket Lab Defense" unit handling military contracts.
Viewed just in terms of revenue, however, the contract is already worth more than six months of the $769 million Rocket Lab already makes in a year. And that's not counting any options that might be added on to the company's missile defense work for Space Force. As Rocket Lab evolves even more to specialize in missile defense, we'll get a better idea of how profitable these kinds of contracts are for a fully vertically integrated Rocket Lab.
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Rocket Lab Wins One of Its Biggest Contracts Ever

Key Points
Rocket Lab’s Q2 report looked solid.
Some concerns about the Neutron’s first launch briefly drove its stock lower.
Rocket Lab (NASDAQ: RKLB), a developer of reusable orbital rockets and other spacecraft, posted its second-quarter earnings report on Aug. 10. Its revenue rose 62% year over year to $234 million, beating analysts' estimates by $3 million. It narrowed its net loss by five cents to $0.08 per share, matching the consensus forecast.
Missed Nvidia in 2009? This Rare Signal Is Flashing Again. In 2009, a "Double Down" signal flashed for a little-known chipmaker called Nvidia. For the first time in years, that same "Total Conviction" signal is flashing for a company 1/100th the size of Nvidia. Continue »
What happened after that report?
Rocket Lab's headline numbers looked solid, but its stock opened 5% lower the following day amid some concerns regarding its new higher-capacity rocket, the Neutron. In the past, the company said it could launch its first Neutron rocket by the end of 2026. But this time, CEO Peter Beck merely said it was targeting the Neutron's delivery to the launchpad by the fourth quarter, and that it was still "balancing the timing of our first launch" against its subsequent launches. Some investors likely interpreted that cautious statement as a warning that the first Neutron launch could slip to the beginning of 2027.
Should investors be concerned?
Rocket Lab's stock stabilized and rose again over the following days, so it doesn't seem like investors are too worried about a major delay. For now, it still has plenty of irons in the fire. It's already launched its smaller Electron rocket 92 times, and its planned takeover of Iridium (NASDAQ: IRDM) will significantly increase its exposure to the satellite services market. Its stock isn't cheap at 50 times this year's sales, but analysts still expect it to more than double its annual revenue from 2025 to 2028.
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Rocket Lab Just Did This After Its Q2 Earnings Report. Here's What It Means For The Stock.

Key Points
A $10,000 investment in Rocket Lab three years ago is worth about $81,000 today.
The same amount in an S&P 500 index fund would have grown to roughly $16,000.
Rocket Lab's revenue rose 38% in 2025, and its backlog hit a record $2.2 billion in the first quarter of 2026.
Three years ago, on Aug. 1, 2023, shares of Rocket Lab (NASDAQ: RKLB) closed at $7.26. As of this writing, they trade at $58.60. That's a return of about 8.1 times, which means a $10,000 investment made that day is worth about $81,000 today.
For comparison, the same $10,000 in an S&P 500 (SNPINDEX: ^GSPC) index fund would have grown to roughly $16,000 over the same stretch -- a good result by any normal standard, and not remotely close.
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And here's the part that makes the number more impressive, not less: it survives a brutal drawdown. Rocket Lab peaked at $151 within the past year, meaning shares have fallen about 61% from their high. Even so, the three-year investor is sitting on about eight times their money.
Here's a look at what built that gain, and what has been taking it apart.
Where the return came from
The gain wasn't just a hot space trade. Rocket Lab's business grew into it.
Revenue climbed from $245 million in 2023 to $436 million in 2024 to a record $602 million in 2025 -- a 38% increase last year and nearly two-and-a-half times the 2023 figure. The company's Electron rocket flew a record 21 missions in 2025, up from 16 the year before.
Interestingly, most of the money doesn't come from launches. Rocket Lab's space systems segment, which builds satellites and the components that go inside them, generated 67% of 2025 revenue. The company many investors still think of as a rocket stock is mostly a satellite manufacturer.
The momentum has carried into this year. First-quarter revenue rose about 63% year over year to a record $200.3 million, an accelerating pace next to last year's growth. Even more, the company's backlog climbed to a record $2.2 billion, up from $1.85 billion at the end of 2025. Management guided for another record in the second quarter, with revenue of $225 million to $240 million. And on July 27, Rocket Lab announced a $266 million contract with the U.S. Space Force for suborbital launch missions, the largest launch contract in the company's history.
Add the coming debut of Neutron, the company's larger rocket, now targeted for late this year, and the operating side of this business has rarely looked stronger.
What the drawdown changed
The growth stock's slide hasn't tracked those operating wins. Shares peaked in late May, drifted lower into the summer, and took their hardest hits in July. Interestingly, the year's biggest strategic swing was greeted as good news: the stock rose sharply on June 29, the day Rocket Lab announced an agreement to acquire satellite communications operator Iridium Communications at an enterprise value of about $8 billion.
What that deal does change is the financial picture ahead. The appeal is easy to see, since Iridium brings an operating satellite network and recurring subscriber revenue. But the price is enormous next to Rocket Lab's roughly $680 million of trailing-12-month revenue. And the company isn't yet profitable -- its net loss over that same stretch topped $180 million.
The financing plan leans on commitments for a $3.6 billion bridge loan, with cash from Rocket Lab's balance sheet and other debt and equity financing sources expected to fund the cash component. And the deal isn't expected to close until mid-2027, so shareholders could be living with that uncertainty (how much new debt, how many new shares, and at what prices) for a long time.
Of course, even after the drawdown, the valuation asks a lot. At a market capitalization of about $35 billion, Rocket Lab trades at more than 50 times its trailing-12-month revenue.
So what should investors take from the $81,000? Ultimately, the return was earned by a business that kept compounding (revenue, launches, backlog) through swings that could have shaken out most holders (shares traded as low as $37.57 within the past year alone). So tenacious holding through all the volatility was key.
Looking ahead, the next three years hinge on two things the last three never faced: Neutron flying on schedule, and what the Iridium financing ultimately costs shareholders. I think the operating business has earned the benefit of the doubt. But the balance sheet hasn't yet. For this reason, I'd personally keep any position in the stock small for now. And I wouldn't let a 61% drawdown alone convince me the stock is cheap.
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Daniel Sparks and his clients do not have positions in any of the stocks mentioned. The Motley Fool has positions in and recommends Rocket Lab. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

$10,000 Invested in Rocket Lab 3 Years Ago Is Worth This Much Today, Even After a 61% Drawdown.

Key Points
Rocket Lab announced it will buy Iridium for $8 billion in 2027.
Rocket Lab isn't yet profitable; Iridium already is.
Next year, the combined company will be both profitable and free-cash-flow-positive.
For years, Wall Street analysts have predicted that profits were just around the corner for Rocket Lab (NASDAQ: RKLB). Ramping Electron launches and the potential for a newer, larger Neutron rocket have been repeatedly cited as reasons to expect Rocket Lab to turn that corner and begin reporting generally accepted accounting principles (GAAP) net earnings -- and free cash flow, too.
It hasn't happened yet, but now that Rocket Lab has announced a big acquisition of satellite company Iridium (NASDAQ: IRDM), I'm prepared to climb out on a limb myself and make the following prediction: Rocket Lab will turn profitable and free-cash-flow-positive in 2027.
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Rocket Lab is buying Iridium
Rocket Lab today is an unprofitable space stock -- just like most space stocks are unprofitable. (Yes, even Space Exploration Technologies.) It's also a cash-burning business -- also like SpaceX. And yet, thanks to one inspired acquisition, Rocket Lab is on the cusp of turning into a company that's not just GAAP profitable, but generating real cash profit as well: free cash flow.
How do I know this?
Consider that over the last 12 months, Rocket Lab has racked up $183 million in GAAP losses and burned through $316 million in negative FCF. Iridium, on the other hand, reported $93 million in GAAP profit over this same period, and $288 million in positive free cash flow.
Were these two companies to become one immediately, Iridium's positive FCF would nearly cancel out Rocket Lab's negative FCF, even as Iridium's positive net profit erased more than half of Rocket Lab's own net losses. Granted, this merger won't happen immediately, but the companies are anticipating a mid-2027 closing date.
So let's fast-forward a few months and examine what the combined company might look like then.
Rocket Lab + Iridium = what?
According to analysts polled by S&P Global Market Intelligence, Rocket Lab's GAAP losses will probably shrink to only $24 million by 2027. Even better, these analysts agree that Rocket Lab is likely to generate positive free cash flow of $44 million next year.
But Iridium will do even better.
Forecasts have Iridium earning $161 million in 2027 (up 56% year over year) and generating free cash flow of $381 million (up 32%). When combined with Rocket Lab's tally, this implies that the combined company will earn $137 million and generate positive free cash flow of $425 million.
What will this work out to in terms of profits per share? That's hard to calculate until we know precisely how many shares Rocket Lab will "pay" for its purchase. Current plans are for half the $8 billion purchase price to be paid in stock; at the announced $54 per share purchase price, this implies Rocket Lab will need to issue about 74.1 million shares of stock.
Adding this to its current share count of 598.2 million shares would imply that Rocket Lab will have 672.3 million shares outstanding when the transaction closes, resulting in per-share profits of approximately $0.20 for the combined company.
But turning profitable in 2027 isn't the only reason Rocket Lab investors might like this acquisition.
Looking beyond the numbers
Three years ago, I had the opportunity to ask Peter Beck, CEO of Rocket Lab, about his plans for the company beyond rockets. The market for space services is already much larger than that for space launch after all, and SpaceX had already demonstrated that it could earn much larger profits from its Starlink satellite communications business than from launching rockets.
And so I asked Beck: What kind of transformative business did he envision becoming "Rocket Lab's Starlink"?
I think we now have the answer: it's Iridium.
Announcing the acquisition last month, Rocket Lab explained that acquiring Iridium will make Rocket Lab a "fully vertically integrated space powerhouse," building satellite parts, building satellites, building rockets to launch those satellites -- and now, operating those satellites as a space business.
Going forward, Rocket Lab plans to use Iridium to provide direct-to-device satellite communications; positioning, navigation, and timing (PNT); and Internet of Things (IoT) services -- one market where SpaceX has only begun to compete and isn't yet dominant, and two more where SpaceX hardly operates at all.
For a space company striving to become the next SpaceX without competing head-to-head with SpaceX in the markets where it's strongest, this seems like the right approach to me. I'm still happiest to learn that Rocket Lab will finally turn profitable next year, but...
The new markets Rocket Lab is opening and the growth opportunities they offer are a nice bonus.
Don’t miss this second chance at a potentially lucrative opportunity
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Nvidia: if you invested $1,000 when we doubled down in 2009, you’d have $506,497!*
Apple: if you invested $1,000 when we doubled down in 2008, you’d have $63,549!*
Netflix: if you invested $1,000 when we doubled down in 2004, you’d have $394,601!*
Right now, we’re issuing “Double Down” alerts for three incredible companies, available when you join Stock Advisor, and there may not be another chance like this anytime soon.
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Rich Smith has positions in Rocket Lab. The Motley Fool has positions in and recommends Rocket Lab. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Prediction: Rocket Lab Will Turn Profitable and Free-Cash-Flow-Positive in 2027 -- Thanks to Iridium

Key Points
Both Rocket Lab and SpaceX have rapidly falling share prices.
The companies are very similar in their growth potential.
SpaceX's larger market cap makes it a much riskier buy right now.
The air has begun to escape from some overinflated corners of the stock market, bringing down space stocks in the process. Space Exploration Technologies (NASDAQ: SPCX) has quickly fallen about 40% from highs set about the time of its initial public offering (IPO) in June, while Rocket Lab (NASDAQ: RKLB) is down almost 60% from its 52-week high, beginning its tumble about the same time SpaceX made its debut.
Investors are beginning to take another look at these space stocks and assessing whether they are a good value right now. But is Rocket Lab a better space stock to buy than SpaceX? Here's my take.
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Tremendous growth ahead
As competitors in the space economy, both Rocket Lab and SpaceX have significant growth opportunities in the years ahead. There are an estimated 1 million satellites proposed for launch into orbit, compared to about 15,000 active today, creating an enormous backlog for launch providers like SpaceX and Rocket Lab.
SpaceX is the current leader in launch services, generating $4 billion in revenue last year and planning to keep growing with the upcoming debut of its Starship rocket. Rocket Lab's launch revenue was just $199 million in 2025, but is set to grow with the debut of its own larger rocket, the Neutron, sometime later this year or in 2027. There are few -- if any -- competitors that can capitalize on this satellite backlog like these two businesses.
Both businesses also have significant opportunities with their own satellite constellations, and SpaceX is again the leader with its Starlink internet service. Starlink generated $11.4 billion in revenue in 2025 and is growing 50% year over year. Rocket Lab plans to build its own vertically integrated service through its recently announced $8 billion acquisition of Iridium, but it is still years away from what SpaceX can offer today.
Founder leadership, but one with more focus
Similarities continue between Rocket Lab and SpaceX, with both operating as founder-led businesses. Rocket Lab was created from scratch by Peter Beck in New Zealand, an unlikely place to build one of the modern commercial space giants. Beck has a fantastic track record of launch success with new rockets and has been focused intensely on this business for two decades now, despite the odds stacked against him.
SpaceX, as you probably know, is led by the idiosyncratic Elon Musk. Musk has propelled SpaceX to unbelievable heights (literally) and is known for eccentric ideas that somehow work. This can be a good thing when something like SpaceX's launch business or Starlink start generating billions in revenue. But it also adds risks when Musk comes up with new grandiose plans, such as his recent artificial intelligence (AI) endeavors.
Musk wants to invest tens of billions, if not hundreds of billions, in data centers for AI on Earth and in orbit, believing it is the path to lower AI compute costs. If this endeavor is successful, it could be wildly profitable. But if it is not, investors could see billions in losses in the years ahead.
Which stock is the better buy?
Another aspect where SpaceX and Rocket Lab need to be compared is valuation. At the time of SpaceX's IPO, Rocket Lab and SpaceX had price-to-sales ratios (P/S) of more than 100, which is unheard of for companies of this size. Rocket Lab's market cap has fallen to $38 billion, while SpaceX remains one of the most valuable companies in the world, with a market cap of $1.5 trillion.
Size should matter in valuation, meaning that a smaller company like Rocket Lab could be worth owning even if it trades at an expensive-looking multiple today.
If forced to choose, Rocket Lab looks like the better buy right now. But neither is making it into my portfolio at these prices.
Should you buy stock in Space Exploration Technologies right now?
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Brett Schafer has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Rocket Lab. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Should You Buy Rocket Lab Over SpaceX? Here's My Take.

Key Points
Rocket Lab's share price has been more than halved in less than three months.
The pullback doesn't necessarily reflect a major change in the company's prospects.
Even if we're not at the exact bottom right now, there's apt to be more upside than downside from here.
Just when it looks like the sell-off can't get any worse, it gets worse. Shares of Rocket Lab (NASDAQ: RKLB) are now down more than 50% from their late-May peak, recently reaching a new multi-week low.
Experienced investors know the sell-off will end sooner or later, making this pullback a buying opportunity. The question is, when should they dive in? I'd suggest right now.
Missed Nvidia in 2009? This Rare Signal Is Flashing Again. In 2009, a "Double Down" signal flashed for a little-known chipmaker called Nvidia. For the first time in years, that same "Total Conviction" signal is flashing for a company 1/100th the size of Nvidia. Continue »
Meet Rocket Lab
That's admittedly easier said than done, given the persistence of this pullback.
This isn't your typical stock-picking scenario, though. This is a growth stock of a company with only a modest present, but a very promising future.
Namely, while its well-proven reusable Electron rocket has successfully deployed over 260 small satellites over 91 launches, its bigger Neutron rocket is expected to begin regular flights late this year or early next year. This puts the company in the so-called -- and biggest -- "medium lift" sliver of the space-launch business that Precedence Research expects to annually grow nearly 12% through 2035, when it will be worth more than $70 billion per year.
Launch services aren't all that Rocket Lab offers, either. It's not even its biggest business, in fact. With its impending acquisition of satellite communications specialist Iridium Communications, the company will be able to help customers build higher-functioning satellites as well.
Precedence expects the satellite communications market itself to grow from less than $109 billion last year to over $260 billion in 2034. For its part, analysts expect Rocket Lab to report top-line growth of more than 50% this year, and nearly 40% next year.
Play the proven pattern
And this raises the question: If the tailwind is so strong, why is the stock falling?
The market environment and industry backdrop always have an impact on any stock's price at any given time. But perhaps never as much as they do on space-related stocks right now. For example, the recent initial public offering (IPO) of Space Exploration Technologies (you know it better as SpaceX) drew attention to all of the space industry's publicly traded companies. As could have been expected, though, SpaceX's post-IPO pullback is now dragging its peers down with it.
Rocket Lab stock's recent volatility isn't exactly new. It's been back and forth quite a bit since early last year, with the ebb and flow you would expect from a relatively young and still-unprofitable company.
Just recognize that this back-and-forth action has developed a discernable pattern. Namely, each dip has stopped short of a prior low, with each pullback eventually leading to a higher high reflective of the company's march toward profitability.
Worth the wild ride
And the shares could move even lower before moving higher again. So even if we are at a bottom, continued volatility remains in the cards no matter what.
Nonetheless, this stock has rewarded investors bold enough to buy on a deep dip. The company's business is growing, tilting the stock's overall momentum upward.
This might help: Analysts' current consensus price target for Rocket Lab is $116.24, or 85% above the present price. Just be sure to buckle up for a bumpy ride if you're getting on board here.
Don’t miss this second chance at a potentially lucrative opportunity
Ever feel like you missed the boat in buying the most successful stocks? Then you’ll want to hear this.
On rare occasions, our expert team of analysts issues a “Double Down” stock recommendation for companies that they think are about to pop. If you’re worried you’ve already missed your chance to invest, now is the best time to buy before it’s too late. And the numbers speak for themselves:
Nvidia: if you invested $1,000 when we doubled down in 2009, you’d have $511,613!*
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James Brumley has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Rocket Lab. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Rocket Lab Stock Keeps Dropping. Here's Exactly When I'd Buy The Dip.

Key Points
Rocket Lab stock closed Friday at $63.91, down about 58% from its $151 peak of the past year.
The average price target across the 17 analysts covering the stock is $114.33, about 79% above the share price.
The planned $8 billion Iridium acquisition leans on a $3.6 billion bridge loan, with more borrowing and stock sales to come.
Rocket Lab (NASDAQ: RKLB) closed Friday at $63.91, down 8.7% in a single session and about 58% below its 52-week high of $151.
Wall Street, on paper, remains far more bullish. The average price target across the 17 analysts covering the stock sits at $114.33 -- about 79% above the share price.
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A gap that wide doesn't leave much room for both sides to be reasonable. Either the market has badly mispriced a fast-growing space company, or the targets are pricing a different company than the one the deal created.
I think it's mostly the second. Here's a closer look at why.
The deal that changed the math
The stock had already pulled back from its May peak when, on June 29, Rocket Lab announced an agreement to acquire satellite operator Iridium Communications (NASDAQ: IRDM) at an enterprise value of about $8 billion. Iridium stockholders would receive $54 per share: $27 in cash, plus Rocket Lab stock through an exchange ratio with a collar that assumes Rocket Lab shares trade between $67.50 and $112.50.
The strategic logic is easy to follow. Iridium generated $871.7 million of revenue in 2025, with operational earnings before interest, taxes, depreciation, and amortization of $495 million (a 57% margin). Buying it hands the launch company an operating global satellite network instead of a decade-long build. Rocket Lab CEO Peter Beck called the agreement "a defining moment for the space industry."
The financing is where the bear case lives. Rocket Lab secured a $3.6 billion bridge loan toward the cash portion of the deal. It plans to cover the rest with its own cash plus more debt and equity.
That is a lot of new leverage, and likely a lot of new shares, for a company that generated about $680 million of revenue over the past 12 months and isn't yet profitable. And the deal isn't expected to close until mid-2027, so the financing uncertainty could linger.
At $63.91, the stock now sits below the bottom of the collar the deal's stock component was built around.
The targets remain far above the market
Meanwhile, the business itself keeps executing. First-quarter revenue rose about 63% year over year to a record $200.3 million, and the company's generally accepted accounting principles (GAAP) net loss narrowed to $45 million. Its backlog climbed to a record $2.2 billion, up about 20% in a single quarter.
Management guided for another record in the second quarter, with revenue of $225 million to $240 million. And the debut launch of the company's larger Neutron rocket remains on track for later this year.
On July 21, the U.S. Space Force awarded Rocket Lab a $266 million contract for 12 suborbital launch missions from Alaska's Kodiak spaceport, with options for six more through 2028 -- the largest U.S. government launch award in the company's history, worth about 39% of its trailing-12-month revenue. The stock rose on the news.
So the market isn't punishing the operating business. It's pricing the financing, plus a space trade that has cooled in a hurry. SpaceX, the sector's giant, has roughly halved from the peak it reached shortly after its June initial public offering (IPO).
And the analysts have seen the deal: in the days after it was announced, Bank of America lifted its target to $115, Roth Capital and Citizens both went to $130, and New Street Research initiated at a street-high $150. Those are bets the financing lands cleanly.
The most recent initiation of coverage lands well under the crowd, too. Piper Sandler started covering the stock this month with a Neutral rating and an $83 price target, about 27% below the consensus figure. When the freshest look in a 17-analyst group comes in that far below the average, the average starts to look less like a consensus and more like an argument -- one with an $8 billion leveraged acquisition at the center of it.
Of course, an average price target isn't an investment case. Is a market value of about $38 billion (about 56 times its trailing-12-month revenue) the right price for this business today? A valuation that rich already assumes years of Neutron launches and satellite growth going right, before layering on an acquisition financed substantially with borrowed money and new shares.
As for me, I'll watch from the sidelines. If the equity piece of the financing gets priced and absorbed, or if Neutron flies on schedule while the backlog keeps compounding, I'd take another look.
Don’t miss this second chance at a potentially lucrative opportunity
Ever feel like you missed the boat in buying the most successful stocks? Then you’ll want to hear this.
On rare occasions, our expert team of analysts issues a “Double Down” stock recommendation for companies that they think are about to pop. If you’re worried you’ve already missed your chance to invest, now is the best time to buy before it’s too late. And the numbers speak for themselves:
Nvidia: if you invested $1,000 when we doubled down in 2009, you’d have $537,140!*
Apple: if you invested $1,000 when we doubled down in 2008, you’d have $63,471!*
Netflix: if you invested $1,000 when we doubled down in 2004, you’d have $377,990!*
Right now, we’re issuing “Double Down” alerts for three incredible companies, available when you join Stock Advisor, and there may not be another chance like this anytime soon.
Daniel Sparks and his clients do not have positions in any of the stocks mentioned. The Motley Fool has positions in and recommends Rocket Lab. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Rocket Lab Has Fallen 58% From Its High While Wall Street's Average Target Sits 79% Above the Price. One Side Is Badly Wrong.

Key Points
After initially surging on the Iridium acquisition news, Rocket Lab shares have since tanked.
Concerns run high that the deal will impact the space company's overall growth, and in turn, its valuation.
Considering the potential for cost and growth synergies, buying today's dip could prove profitable in the long run.
After falling more than 35% over the past month, Rocket Lab's (NASDAQ: RKLB) latest price action may seem troublesome. However, this sharp pullback looks like an opportunity to bottom-fish in this popular space stock.
Yes, the shift in sentiment does have substance. After an initial wave of enthusiasm, investors are now having second thoughts about the company's recent acquisition plans. While this pending deal has negatives, its long-term impact on Rocket Lab's future growth and valuation could offset the initial uncertainty.
Missed Nvidia in 2009? This Rare Signal Is Flashing Again. In 2009, a "Double Down" signal flashed for a little-known chipmaker called Nvidia. For the first time in years, that same "Total Conviction" signal is flashing for a company 1/100th the size of Nvidia. Continue »
Why investors turned bearish on Rocket Lab
On June 29, Rocket Lab, a satellite launch and manufacturing company, announced plans to acquire Iridium Communications (NASDAQ: IRDM) in an $8 billion cash-and-stock deal. As this transaction adds Iridium's satellite network and space telecom business to Rocket Lab's existing capabilities, post-acquisition, Rocket Lab could become a smaller version of Space Exploration Technologies, aka SpaceX.
In fact, it was these SpaceX stock comparisons that initially drove investors to respond positively to the deal announcement, rocketing the rocket stock from the mid $80s to just over $100 per share. Since then, however, shares have fallen back to Earth, and then some. Right now, the stock is hovering just around $70 per share. Initially intrigued by Rocket Lab becoming a possible "SpaceX in the making," the concern now is how this merger affects future growth.
A slowdown today, a resurgence tomorrow?
For now, weakness could persist with Rocket Lab shares. The market is still trying to figure out how to value a company that's diluting its growth rate by acquiring a more mature, already profitable business.
Yet while the initial growth dilution could weigh on shares, this deal could prove worthwhile in the long run. By acquiring a profitable business, Rocket Lab will have greater capacity to self-fund its organic growth efforts, including major projects such as its upcoming Neutron line of reusable rockets.
Also consider the deal's many likely cost and growth synergies. After a one-time slowdown could come a growth resurgence, driving a recovery in its shares. Given this, I'd consider going against the grain and doubling down on a position.
Don’t miss this second chance at a potentially lucrative opportunity
Ever feel like you missed the boat in buying the most successful stocks? Then you’ll want to hear this.
On rare occasions, our expert team of analysts issues a “Double Down” stock recommendation for companies that they think are about to pop. If you’re worried you’ve already missed your chance to invest, now is the best time to buy before it’s too late. And the numbers speak for themselves:
Nvidia: if you invested $1,000 when we doubled down in 2009, you’d have $542,126!*
Apple: if you invested $1,000 when we doubled down in 2008, you’d have $61,306!*
Netflix: if you invested $1,000 when we doubled down in 2004, you’d have $371,519!*
Right now, we’re issuing “Double Down” alerts for three incredible companies, available when you join Stock Advisor, and there may not be another chance like this anytime soon.
*Stock Advisor returns as of July 24, 2026.
Thomas Niel has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Rocket Lab. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

I'd Double A Position in This Space Economy Stock Right Now With No Hesitation

SAP SE SAP reported second-quarter 2026 non-IFRS earnings per share (EPS) of €1.59 ($1.85), which increased 6% from the year-ago quarter. The Zacks Consensus Estimate was pegged at $2.
Despite macroeconomic uncertainty, SAP reported total revenues on a non-IFRS basis of €9.9 billion ($11.5 billion), which increased 9% year over year (up 11% at constant currency or cc). The Zacks Consensus Estimate was pegged at $11.4 billion.
AI strategy is becoming a major competitive advantage for SAP. Management emphasized its Autonomous Enterprise strategy, which combines Business AI with enterprise applications. SAP is embedding AI directly into finance, procurement, supply chain, HR and customer operations. The company's strategy revolves around two major pillars –Autonomous Suite and Business AI Platform. SAP believes customers increasingly value AI solutions that operate using trusted enterprise data while maintaining governance and compliance.
This positioning gives SAP a competitive edge because its AI capabilities are built on decades of customer business processes and transactional data rather than disconnected AI models. As AI adoption expands across enterprises, SAP is well-positioned to monetize AI through higher cloud subscriptions rather than relying solely on standalone AI products.
Cloud Business Continues to Be SAP's Growth Engine
Current cloud backlog reached €22.9 billion in the quarter, representing 27% year-over-year growth (26% at cc). This metric is important because it reflects contracted future cloud revenue, giving investors visibility into future growth.
On a non-IFRS basis, the Cloud and software segment (89.6% of total revenues) registered revenues of €8.9 billion, rising 11% year over year (up 13% at cc).
Cloud revenue increased 22% year over year (24% at cc) to €6.3 billion, on a non-IFRS basis, demonstrating that enterprise customers continue to migrate mission-critical workloads to SAP's cloud ecosystem. SAP's Cloud ERP Suite, where revenue increased 25% (27% at cc) to €5.5 billion, is equally encouraging. Software licenses and support revenues totaled €2.6 billion, representing a 9% decrease (down 8% at cc) year over year.
Services business (10.4% of total revenues) posted revenues of €1 billion, down 3% year over year (down 2% at cc).
Expanding Clientele Bodes Well
In the second quarter, organizations worldwide continued to adopt the “RISE with SAP” program to support their comprehensive business transformations. Notable adopters included ACCIONA, AIRBUS, City of Osnabrück, Electrolux, Eli Lilly, Gilead Sciences, HARTING, Hindustan Zinc, The Humboldt University of Berlin, JET, Ørsted, Samsonite Group, Shell, The Shoprite Group, SIGNAL IDUNA, SPAR (CH), Sun Pharma and Vonovia.
“GROW with SAP” was implemented by Gooroo Crédito, Modular Data Centers, Parloa, Tarrant County, and Techem.
Major global brands across various industries, including AMADEUS, BBC, Booking.com, GOL, Oki Electric Industry, PwC, University Hospital Zurich and Vale, chose SAP's AI and data solutions.
SAP SE Price, Consensus and EPS Surprise
SAP secured significant customer wins across its solution portfolio, with new or expanded engagements from leading organizations such as Birlasoft, Capgemini, Haier Group and KaDeWe.
Döhler, FANUC Europe, Fonterra, Natura Cosméticos, SABESP and TEAG went live on SAP solutions during the quarter.
SAP’s cloud revenue growth was especially strong in the APJ and EMEA regions and robust in the Americas, with standout performances from Brazil, France, Germany, Italy, India, South Korea and Spain. It remained strong in the United States, Australia and Singapore.
Margin Details
Non-IFRS gross profit of €7.3 billion increased 9% from the year-ago quarter (up 11% at cc).
Non-IFRS cloud gross profit increased 22% year over year to €4.7 billion (up 23% at cc). Non-IFRS cloud gross margin fell 0.6 percentage points to 74.6%.
SAP's non-IFRS operating profit rose 7% (up 9% at cc) to €2.7 billion, while margin decreased to 27.8%.
Balance Sheet & Cash Flow
As of June 30, 2026, SAP had cash and cash equivalents of €11.6 billion compared with €10.1 billion as of March 31, 2026.
In the second quarter, the company generated operating cash of €3.2 billion, up 22% year over year. Free cash flow, a key metric of operational strength, rose 27% to €3 billion during the quarter.
SAP also continues returning capital to shareholders. Its newly authorized €10 billion share repurchase program remains active. As of June 30, the company had repurchased more than 16.28 million shares and spent approximately €2.6 billion.
SAP’s 2026 Guidance Reaffirmed Despite Lower Profit Outlook
The company lowered its non-IFRS operating profit outlook from €11.9–€12.3 billion to €11.8–€12.2 billion. The revision stems almost entirely from the acquisitions of Dremio and Prior Labs, which closed in July. Management expects these acquisitions to create a dilutive impact exceeding €100 million during 2026.
Despite lowering operating profit guidance slightly, SAP maintained nearly all of its major financial targets. Management still expects cloud revenue between €25.8 billion and €26.2 billion, cloud and software revenue between €36.3 billion and €36.8 billion and approximately €10 billion in free cash flow.
Additionally, SAP expects cloud backlog growth to remain strong, though slightly slower, total revenue growth to match 2025 levels, revenue acceleration in 2027 and operating expense growth to remain below revenue growth.
Nonetheless, the company acknowledged that its outlook assumes a near-term de-escalation of geopolitical tensions in the Middle East. Any prolonged conflict could negatively impact enterprise spending or business operations.
SAP’s Zacks Rank
SAP currently carries a Zacks Rank #4 (Sell).
Recent Performances
America Movil, S.A.B. de C.V. AMX reported net income per ADR of 47 cents for the second quarter of 2026, up from 38 cents in the prior-year quarter. The earnings figure missed the Zacks Consensus Estimate of 52 cents. Total quarterly revenues rose 3.1% to Mex$241,071 million, driven by rapid momentum across the Service and Equipment segments.
BlackBerry Limited BB reported first-quarter fiscal 2027 non-GAAP earnings per share (EPS) of 4 cents. The figure beat the company’s estimate of 2-3 cents. In the year-ago quarter, it reported a non-GAAP EPS of 2 cents. The Zacks Consensus Estimate was pegged at 3 cents per share. BlackBerry generated $152.9 million in fiscal first-quarter revenue, representing 26% year-over-year growth.
Iridium Communications IRDM reported EPS of 9 cents for the second quarter of 2026, missing the Zacks Consensus Estimate of 26 cents. The bottom line also compared unfavorably with the prior-year quarter's figure of 20 cents. Iridium reported second-quarter revenue of $225.2 million, representing 4% year-over-year growth. The consensus mark was pinned at $221.2 million.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

SAP Q2 Earnings Up Y/Y on Cloud Demand, Buyouts Impact Profit Outlook

Key Points
Rocket Lab stock is down 55% from its highs.
The company is making aggressive moves to compete with SpaceX, including its recently announced proposed acquisition of Iridium.
The stock still looks overvalued right now.
A space economy boom is turning into a stock market collapse. After the monster Space Exploration Technologies (better known as SpaceX) IPO earlier this year, space stocks began to slip, and quickly, from their highs. Rocket Lab (NASDAQ: RKLB) could be called the poster child for these wild gyrations in space stocks.
The maker of rockets and other space systems saw its stock rise by more than 150% at one point over the last 12 months before falling 55% from a high set in May. As of this writing, the stock trades at $67.50. Should you buy shares of Rocket Lab below $70?
Missed Nvidia in 2009? This Rare Signal Is Flashing Again. In 2009, a "Double Down" signal flashed for a little-known chipmaker called Nvidia. For the first time in years, that same "Total Conviction" signal is flashing for a company 1/100th the size of Nvidia. Continue »
The answer is clear if you look at the numbers.
A potentially transformative acquisition
Rocket Lab has defied the odds. It looks as if the business is poised to become the second vertically integrated spaceflight player, operating alongside SpaceX as a transportation and services juggernaut for companies wanting to operate in orbit.
It has a new rocket, the Neutron, which is undergoing testing and will bring it to payload parity with SpaceX's current workhorse, the Falcon 9. In addition to sending payloads into orbit, Rocket Lab has developed and acquired space systems products, including satellite production, space capsules, energy generation, and communications.
Combined, this aggressive push to vertically integrate space economy services has led to $680 million in trailing 12-month revenue, up over 1,000% in the last five years. Now, it is making a potentially transformative acquisition of Iridium, a satellite communications provider. This is being done to accelerate its timeline to directly compete with SpaceX's Starlink satellite internet service and to obtain L-band spectrum rights at a reasonable price. Iridium is being acquired for $8 billion and generates $871 million in revenue, more than Rocket Lab's entire business today.
If this acquisition closes and the Neutron rocket begins commercial flights, Rocket Lab's capabilities will start looking more like SpaceX's in the near future.
Should you buy Rocket Lab while it's below $70?
With a falling share price, you might think that Rocket Lab now trades at a reasonable price relative to its growth potential. However, as with many space economy stocks, shares of Rocket Lab seem to have gotten well ahead of themselves in the last few years.
After this drawdown, Rocket Lab trades at a price-to-sales ratio (P/S) of 55, which is an extreme multiple rarely seen in the stock market. Even if revenue grows more than 10 times over the next five years, it will only bring this P/S ratio down to around the S&P 500's average, before considering shareholder dilution.
For this reason, investors should not buy Rocket Lab stock right now. Wait for it to fall even more from here.
Don’t miss this second chance at a potentially lucrative opportunity
Ever feel like you missed the boat in buying the most successful stocks? Then you’ll want to hear this.
On rare occasions, our expert team of analysts issues a “Double Down” stock recommendation for companies that they think are about to pop. If you’re worried you’ve already missed your chance to invest, now is the best time to buy before it’s too late. And the numbers speak for themselves:
Nvidia: if you invested $1,000 when we doubled down in 2009, you’d have $526,675!*
Apple: if you invested $1,000 when we doubled down in 2008, you’d have $63,609!*
Netflix: if you invested $1,000 when we doubled down in 2004, you’d have $371,842!*
Right now, we’re issuing “Double Down” alerts for three incredible companies, available when you join Stock Advisor, and there may not be another chance like this anytime soon.
*Stock Advisor returns as of July 20, 2026.
Brett Schafer has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Rocket Lab. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.