Rocket Lab USA (NASDAQ: RKLB) shares surged 8% Monday morning after Citi analyst Jason Gursky raised his price target for the company from $33 to $50, while maintaining a Buy rating.
The new $50 target is currently the highest on Wall Street for Rocket Lab, a company known for its satellite systems and launch services. Gursky’s bullish stance reflects an updated valuation model that now considers revenue potential through 2029, which he estimates will reach approximately $2.6 billion.
In his note, Gursky pointed to several factors that could shape Rocket Lab’s near-term performance, including updates on the development of the Neutron rocket, possible announcements from the Department of Defense, and the company’s success in securing new launch contracts.
He projects Rocket Lab’s growth will be driven by around 20 Neutron launches annually and an increase in satellite manufacturing contracts, especially from U.S. government programs. His projections also account for an estimated $50 million in annual revenue from the Geost acquisition, expected to close in the second half of 2025.
Gursky’s $50 target is based on a 15x revenue multiple, which gives an implied valuation of $72, then discounted at Rocket Lab’s 13% weighted average cost of capital to derive the 12-month price target.
