Space equities are having another tough year. Should you buy?

Our theme of Space inventory continues to underperform, falling 17% year-to-date, versus a decline in the S&P 500 which remains down 6%. Today, corporate-backed space programs have actually come a long way thanks to the Covid-19 pandemic, with companies like SpaceX, Virgin Galactic and BlueOrigin launching multiple crews and high-profile individuals into space. However, space stocks did not fare as well as investors reduced their exposure to futuristic stocks as they brace for higher rates and tighter monetary policy.

Although volatility may continue in the short term as investors have prioritized cyclical players and companies with stronger cash flows, there are still very good reasons to invest in space stocks over the long term. There has been a gradual shift from government space programs to private ones, and this could bode well for companies in our theme. Additionally, new markets are opening up ranging from reusable rockets, satellite internet, space tourism, and point-to-point transportation around the Earth, which could lead to revenue growth for the long-term theme. .

In our theme, Lockheed Martin has been the best performer, with its stock up 12% since the start of 2022, in part due to ongoing tensions between Ukraine and Russia, which have pushed defense stocks higher. On another side, Galactic Virgo was the worst performer, with its stock down nearly 36% year-to-date.

Below is our previous coverage of the Space Stocks theme where you can follow our vision over time.

[10/15/2021] Space stocks to watch as SpaceX and Blue Origin hit new milestones

Our theme of Space inventory has underperformed this year, down 7% year-to-date, compared to a return of nearly 18% on the S&P 500. However, there have been some notable developments in the space sector in recent weeks. Elon Musk has argued that SpaceX saw its valuation soar to more than $100 billion last week as the company reached a deal to sell insider stock in the company. This would make SpaceX the second most valuable private company in the world after Bytedance in China. Additionally, Jeff Bezos’ BlueOrigin successfully launched the second crewed mission of its New Shepard rocket on Wednesday. These high-profile developments could bode well for publicly traded stocks exposed to the space theme. As we noted earlier, the theme’s longer-term prospects also look promising, given the shift from government-led space programs to corporate-backed ones and the emergence of a host of opportunities. space-related such as reusable rockets, space tourism and satellite internet.

Although all stocks in our theme significantly underperformed the broader markets, Lockheed Martin was the best performer, with the stock up 2% year-to-date. On another side, Maxar Technologies was the worst performer, with its stock down about 22% year-to-date.

[7/15/2021] Virgin Galactic, Aerojet Rocketdyne: How are space stocks doing?

Our theme of Space inventory has underperformed this year, rising about 8% since the start of the year, compared to a return of more than 17% for the S&P 500. That said, things could improve for these stocks. July is shaping up to be an eventful month for the space industry. Earlier this month, Galactic Virgo (NYSE: SPCE) successfully completed its first full-crew test flight, which carried its founder Richard Branson into space. Separately, private startup Blue Origin plans to fly its founder, e-commerce billionaire Jeff Bezos, on his first crewed flight on his New Shepard rocket on July 20. These high-profile trips are likely to create a lot of buzz for the space industry, with a focus on short-term publicly traded space stocks. The longer-term outlook for the sector also looks promising, given the shift from government-led space programs to corporate-backed ones and the emergence of a host of space-related opportunities, including reusable rockets, satellite Internet and point-to-point. – punctual transport. Virgin Galactic was the top performer in our theme, up around 39% year-to-date. On another side, Aerojet Rocketdyne was the worst performer, with its stock down about 11% year-to-date.

See our Space inventory theme for the complete list of companies and an overview of their financial performance.

[8/10/2020]

Investor interest in the field of space exploration has increased after Elon Musk’s SpaceX successfully completed its first manned mission this year. There are a few big trends driving the industry. First, there is a gradual shift from government-led space programs to corporate-supported ones. Additionally, new markets seem to be opening up, ranging from reusable rockets to satellite internet, space travel and point-to-point transportation around the Earth. According to Morgan Stanley, the global space industry is poised to grow significantly over the next two decades, growing from around $350 billion currently to over $1 trillion by 2040. ^[1]

Although SpaceX remains a private company, we chose a theme from a few publicly traded space companies, including Lockheed Martin (NYSE:LMT), Aerojet Rocketdyne (NYSE: AJRD), Iridium (NASDAQ: IRDM)and Galactic Virgo as part of our theme Space stocks to watch. Parts of the analysis are summarized below.

Lockheed Martin ($108 billion market cap, +0% YTD), is a diversified aerospace company that also manufactures satellites and spacecraft for government and commercial customers. The company is developing the Orion spacecraft which is intended for use in NASA’s human spaceflight programs that will venture into deep space and lunar orbit. The company also provides launch services under the United Launch Alliance partnership with Boeing.

Virgin Galactic ($4 billion, +55%) is an aerospace company specializing in suborbital spaceflight for individuals and researchers. Although the company is currently in the testing phase and not yet generating significant revenue, things are expected to change in the coming quarters as it will likely begin commercial spaceflight carrying paying space tourists from 2021, charging around 250 $000 to each passenger.

Aerojet Rocketdyne ($3.4 billion, -7%) is an American rocket and missile propulsion manufacturer. While the company derives more than half of its revenue from missile defense systems, its space business is also poised to grow given its contracts with Boeing’s SLS rocket, Northrop’s OmegA and United’s Vulcan rocket. Launch Alliance.

Iridium Communications ($4 billion, +20%) operates a constellation of satellites which are used for worldwide voice and data communication from portable satellite phones and other devices. The company basically provides communication services across the world, even in areas where there is no mobile phone coverage. Iridium is largely aimed at governments and private sector companies, including maritime and aerospace solutions.

What if you were looking for a more balanced portfolio instead? here is a quality portfolio which has consistently beaten the market since late 2016.

Invest with Trefis Wallets that beat the market

See everything Trefis Price estimates