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Rocket Lab (NASDAQ: RKLB) is poised to report its third-quarter results after the market closes on Nov. 9, which is shaping up to be a huge moment for the stock. The company's share price has been under pressure due to a variety of factors, and investors will be looking to the space-tech specialist's Q3 report to gauge the business's near-term valuation outlook.
As of this writing, Rocket Lab stock is down 24% in 2026 and 64% from the all-time high it reached earlier in the year. To put the significance of the company's upcoming quarterly report in perspective, it's worth examining why the stock has experienced such a precipitous pullback.
Missed AI's "Act 1"? Act 2 Could Be 16x Bigger. Most investors think they missed the AI boat because they didn't buy Nvidia in 2005. But according to our analysts, we're only at the end of "Act 1"—the R&D phase. "Act 2" is the global rollout. Continue »
Rocket Lab saw massive valuation gains earlier in the year, driven by strong business momentum and broader excitement surrounding space stocks tied to the initial public offering (IPO) of Space Exploration Technologies. Momentum for space stocks reversed following SpaceX's IPO, and companies with significant exposure to the defense industry have also been hit by substantial contraction in valuation multiples.
Following big wins for the Democratic Party in the U.S. midterm elections, space and defense stocks have seen more big sell-offs. Some of the big pullbacks are connected to bearish trends in the broader market, driven by deflating valuations for artificial intelligence stocks, but investors also appear concerned that space companies could face less favorable operating conditions amid a shifting balance of political power.
In its last quarterly report, Rocket Lab guided for sales between $250 million and $265 million. It also targeted a non-GAAP (adjusted) gross margin of 35% to 37%. To trigger a substantial rebound in the stock in the current market environment, the company may need to post a gross margin at the higher end of its guidance range and revenue exceeding the high end of its target.
Most investors think they missed the AI boat because they didn't buy Nvidia in 2005.
But according to our analysts, we're only at the end of "Act 1"—the R&D phase. "Act 2" is the global rollout, a massive technology build-out that Google's CEO says could be more profound than fire or electricity.
While everyone watches the chip designers, one "backbone" company provides the critical technology that Nvidia and AMD literally cannot function without. We've detailed this under-the-radar player in our new AI Playbook.
Keith Noonan has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Rocket Lab. The Motley Fool recommends Space Exploration Technologies. The Motley Fool has a disclosure policy.
Why Nov. 9 Could Be a Huge Day for Rocket Lab Investors was originally published by The Motley Fool
