Cathie Wood Buys the Dip in Rocket Lab Stock, Adds $32M in Shares
I'm LongbridgeAI, I can summarize articles.ARK Invest's Cathie Wood purchased approximately $32 million in Rocket Lab (RKLB) shares, adding to recent buys totaling $44.4 million over two days. This 'buying the dip' strategy occurred despite RKLB's recent decline due to a NASA contract loss to Blue Origin. Concurrently, ARK trimmed its AMD holdings. Despite short-term setbacks, Rocket Lab maintains a record $2.36 billion backlog and strong Wall Street bullishness, with analysts citing long-term growth potential in launch services and the planned Iridium acquisition.
According to ARK Invest's daily fund disclosures, Cathie Wood purchased 504,799 shares of Rocket Lab USA (RKLB) across three ETFs on Tuesday, worth about $31.57 million based on the stock's $62.54 closing price. The purchase came as Rocket Lab shares fell 2.2% on Tuesday, marking the stock's ninth decline in 10 sessions.
ARK had also purchased 200,303 shares on Monday, bringing its total purchases over the two sessions to 705,102 shares, worth roughly $44.4 million.
Meanwhile, Wood continued trimming exposure to chip giant Advanced Micro Devices (AMD). The ARK funds sold 7,450 AMD shares for $3.4 million, even as the stock fell 11.1%.
Why Is Wood Betting on RKLB Stock?
Wood's buying comes as Rocket Lab faces renewed concerns surrounding its Neutron rocket and a recent setback from NASA. The space agency selected Blue Origin for a Mars Telecommunications Network contract worth up to $700 million. Rocket Lab had competed for the contract, with the decision weighing on investor sentiment and sending its shares down 1.4% in after-hours trading on Tuesday.
Even so, Rocket Lab's underlying business continues to grow. Rocket Lab ended the second quarter with a record $2.36 billion backlog, up 137% year-over-year. More than 45% of that backlog is expected to be recognized within the next 12 months, while the company has more than 90 launches booked.
What's Next for Rocket Lab Stock?
Neutron remains the biggest catalyst and risk for Rocket Lab. CEO Peter Beck recently said the window for an end-of-year inaugural launch is narrowing, with several major testing milestones still ahead.
Wall Street remains bullish despite recent pressure. BofA analyst Ronald Epstein recently maintained his Buy rating while lowering his price target to $110 from $115. The new target still implies 75.9% upside from current levels.
Epstein said Rocket Lab's strength across launch, satellites, and space services supports the company's long‑term upside. He also views Rocket Lab's planned acquisition of Iridium (IRDM) as an important step in expanding its space-based applications. Iridium provides recurring service revenue across commercial, government, and national-security markets, including secure communications and positioning, navigation, and timing (PNT).
The latest purchases suggest that Wood sees the recent RKLB selloff as an attractive entry point. However, Rocket Lab will need to execute on Neutron and convert its backlog into revenue for the bullish case to play out.
Is RKLB a Good Buy Right Now?
On TipRanks, RKLB has a Strong Buy consensus rating based on 12 Buys and four Hold ratings. The average Rocket Lab price target of $110.60 implies 76.9% upside potential from current levels. Year-to-date, RKLB shares have dropped 10.4%.