Rocket Lab Recovers as ARK Says Neutron Competes with Falcon 9

ARK Invest purchased approximately 233,482 shares in Rocket Lab worth nearly $16.6 million spread across three funds, following purchases totaling $25.7 million last September.

Two analysts at the fund, Tasha Keeney and Daniel Maguire, said that the Neutron rocket being developed by the company is "closing in on" the Falcon 9 rocket, citing a payload target of 13,000 kilograms compared to about 17,000 kilograms for Falcon 9's reusable capacity, and noted that satellite operators are in "dire need" of launch capabilities.

The company's shares had fallen 5 percent to $68.40 in Thursday's session before recovering as the fund's note circulated. This purchase adds to previous purchases announced by the fund in September, when the company's shares rose as Berenberg Bank initiated coverage of the stock with a price target of $83.

This development concerns space sector investors and launch service providers, because the entry of a second player capable of carrying heavy payloads into orbit expands options for satellite operators and puts pressure on launch prices. Furthermore, major fund moves serve as an indicator of the market's assessment of Neutron's viability ahead of its maiden flight.

What do these terms mean?

Launch market: The market in which companies sell services to transport payloads from Earth to orbit.

Reusable payload capacity: A rocket's ability to transport a specific weight into orbit with the capability to recover a portion of it and reuse it.

Price target: An estimate issued by analysts for a stock price they expect it to reach within a specified timeframe.

Backlog: Total confirmed orders that have not yet been executed, used as an indicator of future revenues.