The article says that Rocket Lab would use the proceeds to fund development a larger vehicle, called Neutron, that would be used for megaconstellations. (The company hadn’t shown interest before in a vehicle larger than Electron.)
Boggles the mind. FOMO-driven space investors going wild, living in a parallel universe where Starship does not exist.Just to recoup a $4B investment you need after-tax profits of at least $4B. If Electron earns $1M net profit per launch (15% of launch price), that’s 4000 Electron launches.At even 100 launches per year, that’s 40 years to earn back the $4B. And that’s ignoring time value of money or any reasonable annual return on investment. If you take that into account, you’re probably looking at 100 years.As for the new, larger launch vehicle. How much larger can you go in a world where both F9 and Starship exists?Just how informed is the space investment market? “Not very”, seems to be the answer.
Quote from: M.E.T. on 03/01/2021 01:15 amBoggles the mind. FOMO-driven space investors going wild, living in a parallel universe where Starship does not exist.Just to recoup a $4B investment you need after-tax profits of at least $4B. If Electron earns $1M net profit per launch (15% of launch price), that’s 4000 Electron launches.At even 100 launches per year, that’s 40 years to earn back the $4B. And that’s ignoring time value of money or any reasonable annual return on investment. If you take that into account, you’re probably looking at 100 years.As for the new, larger launch vehicle. How much larger can you go in a world where both F9 and Starship exists?Just how informed is the space investment market? “Not very”, seems to be the answer.Nobody is investing $4B, the article simply says that going public will allow them to raise $470M and will value the company at $4.1B.
Peter Beck is running out of hats.
Quote from: ncb1397 on 03/01/2021 02:08 amPeter Beck is running out of hats.Indeed. It would seem that the trajectory is converging on exactly what Elon asserted from the start when asked about the viability of smallsat launchers. Namely that reusability is fundamental to the launch business of the future, and reusability grows more efficient the larger the launch vehicle.
Rocket Lab is expected to use proceeds from the deal to fund development of a medium-lift “Neutron” launch vehicle tailored for use in satellite mega-constellations, space missions and commercial spaceflight, the people said. The Neutron rocket is expected to be able to lift most satellites forecast to launch in the coming years and be positioned as a lower-cost alternative to larger vehicles, they said.
Quote from: M.E.T. on 03/01/2021 01:15 amBoggles the mind. FOMO-driven space investors going wild, living in a parallel universe where Starship does not exist.Just to recoup a $4B investment you need after-tax profits of at least $4B. If Electron earns $1M net profit per launch (15% of launch price), that’s 4000 Electron launches.At even 100 launches per year, that’s 40 years to earn back the $4B. And that’s ignoring time value of money or any reasonable annual return on investment. If you take that into account, you’re probably looking at 100 years.As for the new, larger launch vehicle. How much larger can you go in a world where both F9 and Starship exists?Just how informed is the space investment market? “Not very”, seems to be the answer.Just compare it to Tesla. They launched 7 times in 2020. Assuming 10% net earnings on revenue (WAG), and $7 million per electron launch, they made $4.9 million last year. A market cap of $4,100 million would therefore be a 836x P/E ratio. Tesla is trading at 1060x. SpaceX P/E may be similar or worse. Both are based on growing into their market capitalization, not current earnings but RocketLab wouldn't be a megacap stock at that valuation so doing so is a bit easier (more plausible).
Companies are not values only on their past returns but future potential.SpaceX has demonstrated that reusability is technically viable and the mega-constellation boom is providing a market for cheap launch. There is room for a second provider of cheap LEO launches and RocketLab has an excellent shot at this.Despite plenty of funding and institutional knowledge competitors like Blue Origin, ULA and ArianeSpace are moving very slowly, if at all. Right now OneWeb is launching with Soyuz because it's the cheapest option that is not also directly funding a competitor, surely we would be able to beat Soviet designs in 2021?
Rocket Lab is expected to use proceeds from the deal to fund development of a medium-lift “Neutron” launch vehicle tailored for use in satellite mega-constellations, space missions and commercial spaceflight, the people said. The Neutron rocket is expected to be able to lift most satellites forecast to launch in the coming years and be positioned as a lower-cost alternative to larger vehicles, they said.
Boggles the mind. FOMO-driven space investors going wild, living in a parallel universe where Starship does not exist.