Rocket Lab (RKLB) Surpasses SpaceX (SPCX), Targeting Nasdaq 100

▲ Nasdaq 100, SpaceX (SPCX), Rocket Lab (RKLB)/ AI Generated Image

In the midst of the SpaceX (SpaceX, SPCX) listing frenzy, an aerospace stock has emerged that is first to join the Nasdaq 100 index. Rocket Lab (Rocket Lab, RKLB) has risen as a better investment alternative than SpaceX, leveraging its index inclusion effect and growth businesses.

According to the investment media 24/7 Wall Street on June 20 (local time), Nasdaq has decided to include Rocket Lab in the Nasdaq 100 index starting June 22. While SpaceX is expected to be included in the index in early July, Rocket Lab will enter the Nasdaq 100 index first as a pure aerospace stock.

Nasdaq has moved to change regulations to expedite the index inclusion process for newly listed mega-cap companies. The market interpreted this move as being mindful of SpaceX's large initial public offering (IPO). However, the first beneficiary is Rocket Lab, not SpaceX.

Rocket Lab was added to the index inclusion list along with Nebius Group (NBIS), CoreWeave (CRWV), Teradyne (TER), and Astera Labs (ALAB). Funds and exchange-traded funds (ETFs) that track the Nasdaq 100 index must purchase the included stocks. Analysis suggests that hundreds of billions of dollars in tracking funds could create short-term supply and demand.

Stock indicators also support Rocket Lab. Rocket Lab recorded a 52-week high of $151 at the end of May and then fell by about 30%. Nevertheless, its year-to-date increase is about 53%. SpaceX has risen about 37% since its IPO, and its recent decline from its high is stated as 18%.

The business structure is also differentiated. Rocket Lab's space systems division already accounts for most of its revenue. It is expanding its business into satellite manufacturing, components, software, and defense contracts, reducing its reliance on launch services. SpaceX's core growth drivers are its launch business and Starlink.

24/7 Wall Street evaluated that while SpaceX is an excellent company, its listing price already reflects years of expected success. The expiration of lock-up periods, repayment of bridge loans, and the burden of raising additional capital were also mentioned as short-term variables. In contrast, Rocket Lab is emerging as an aerospace investment alternative, driven by its inclusion in the Nasdaq 100 index and business diversification.

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