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Space Exploration Technologies (NASDAQ: SPCX) may be the biggest name in the space race, but it's not the only company worth investing in. Rocket Lab (NASDAQ: RKLB) and Redwire (NYSE: RDW) offer different ways to gain exposure to the growing demand for space technology and defense.
Here's why these two industrial stocks could be worth having on a watch list.
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Rocket Lab's Electron rocket serves customers looking to launch smaller satellites, while its space systems business manufactures spacecraft, satellite components, and other technologies. That combination allows it to participate in various areas of the space industry rather than relying solely on launch revenue.
Then there's Neutron, Rocket Lab's planned medium-lift rocket designed to carry larger payloads. Neutron could open the door to more lucrative opportunities, such as national security missions and satellite constellation launches.
The company is also gaining traction with government customers. For example, Rocket Lab has secured contracts to manufacture satellites for U.S. national security programs, including a contract worth up to $397 million for spacecraft designed to detect and track airborne threats from space.
But it doesn't stop there. Rocket Lab is looking to increase revenue through acquisitions, having agreed in June to buy Iridium for about $8 billion.
Although SpaceX operates at massive scale, its growing focus on the Starlink constellation could create more opportunities for independent launch providers. The result is that customers face a limited number of Falcon 9 launches available, as SpaceX prioritizes its own missions.
Rocket Lab also offers a different growth profile, with opportunities in dedicated launches, satellite manufacturing, and defense. Still, Rocket Lab faces risks around rocket development, delays, and competition. It even pushed Neutron's inaugural launch to 2027 due to technical challenges.
Compared with SpaceX's price-to-sales (P/S) ratio of 59, Rocket Lab stock trades at around 44x. This leaves very little room for disappointment, especially given its costs and execution risks.
Meanwhile, another company is supplying the technology behind critical space missions.
Redwire develops spacecraft components, deployable solar arrays, and other technologies to support space missions. Its products have supported prominent programs involving NASA, the European Space Agency, and the U.S. Space Force.
The company has also been expanding its defense business through contracts for uncrewed aerial systems and military technologies. And the results are starting to show up in the earnings. Its second-quarter 2026 results showed increased demand for products such as its Stalker and Penguin aircraft, as well as for Octopus intelligence, surveillance, and reconnaissance payloads.
But it doesn't stop there. Redwire is also pursuing commercial opportunities. In fact, it has already supported pharmaceutical research in orbit through its PIL-BOX platform, allowing researchers to study different materials under microgravity conditions.
While SpaceX focuses on launch services and spacecraft, Redwire supplies the technologies for building and operating space systems. That allows it to benefit from investment across multiple space programs.
On top of that, Redwire gives investors exposure to defense technology beyond the space sector, including autonomous aircraft and surveillance products. That helps diversify its business across government and commercial applications.
But the company must still manage risks related to contract timing, manufacturing, and the integration of its acquisitions. On the bright side, the stock trades at a P/S ratio of just under 4 times, which could look more reasonable to investors who believe in its long-term growth.
Each offers a different way to ride the space boom, but their growth potential and execution must be weighed carefully. SpaceX may dominate the headlines, but Rocket Lab offers exposure to launch services and spacecraft manufacturing, while Redwire focuses on space infrastructure and defense technology.
Rocket Lab looks like the more cautious pick, given its larger revenue base. Redwire is the higher-risk choice, with a smaller revenue base but a far lower valuation, and both could be a better fit than SpaceX.
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Rick Orford 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.
You Can Do Better Than SpaceX: 2 Industrial Stocks to Buy Instead was originally published by The Motley Fool
