What Happened?
Shares of aerospace and defense company Rocket Lab (NASDAQ:RKLB) jumped 4.5% in the afternoon session after Cantor Fitzgerald reiterated its "Overweight" rating on the stock, calling the company the premier alternative to SpaceX.
The firm’s positive view was based on the company's strong performance, which included a record-breaking third quarter. Additionally, Rocket Lab had secured a significant contract from the U.S. Space Development Agency. This bullish stance from the analyst firm followed these key operational successes, reinforcing investor confidence in the company's market position and future growth prospects.
The shares closed the day at $91.80, up 5.6% from previous close.
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What Is The Market Telling Us
Rocket Lab’s shares are extremely volatile and have had 75 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The previous big move we wrote about was 7 days ago when the stock dropped 2% on the news that a filing with the Securities and Exchange Commission revealed a significant stock sale by the company's Chief Commercial Officer, Frank Klein. The disclosure showed that Klein sold 100,000 shares, raising about $7.3 million. This transaction occurred after the stock enjoyed a strong rally, climbing more than 70% over the previous month and reaching a new all-time high. Insider sales, particularly after a sharp increase in share price, can cause concern among investors. Such moves were sometimes seen as an executive deciding to take profits, which raised questions about the stock's valuation, especially given that the company remained unprofitable.
Rocket Lab is up 20.3% since the beginning of the year, and at $91.39 per share, has set a new 52-week high. Investors who bought $1,000 worth of Rocket Lab’s shares 5 years ago would now be looking at an investment worth $8,704.
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