RDW, RKLB, LUNR Tumble After Blue Origin Explosion
Rendy Andriyanto
Gotrade Team
Reviewed by Gotrade Internal Analyst
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Gotrade News - Space sector stocks sold off sharply on Monday after Blue Origin's New Glenn rocket exploded during a hot-fire engine test in Florida. Redwire (RDW), Rocket Lab (RKLB), and Intuitive Machines (LUNR) all posted double-digit percentage losses on heavy volume.
The Friday explosion generated shockwaves equivalent to a 2.5 magnitude earthquake, rattling investor confidence across launch service providers. Sector caution overshadowed prior-week NASA lunar exploration contracts that had supported space-stock valuations.
Key Takeaways
Redwire (RDW) fell 15.83% to $20.68 after a Jefferies downgrade citing valuation expansion.
Rocket Lab (RKLB) dropped 14.70% to $122.39, marking three consecutive sessions of losses.
According to Insider Monkey, Jefferies downgraded Redwire from buy to hold despite raising its price target to $24 from $13. The firm flagged a threefold year-to-date surge driven by valuation expansion rather than improving fundamentals.
Jefferies wrote that the rally appears to have priced in growth prospects, leaving limited near-term upside. The note added that Redwire remains unprofitable and must convert its order backlog into actual revenue and profits.
Recent operational wins did little to cushion the slide for the satellite component maker. Redwire secured fresh orders from the U.S. Army Aviation Center of Excellence and a NATO member nation for its Stalker and Penguin uncrewed aerial systems.
Rocket Lab and Intuitive Machines Slide on Launch Risk
As reported by Insider Monkey, Rocket Lab extended its losing streak to a third session after the Blue Origin test failure spooked launch-service investors. The selloff hit competitors including Planet Labs and Intuitive Machines as caution rippled through the industry.
The decline overshadowed Rocket Lab's completed acquisition of Motiv Space Systems, now rebranded as Rocket Lab Robotics. The deal positions the company to offer end-to-end Mars mission solutions, including launch, spacecraft, software, and Mars-proven robotics.
Per Insider Monkey, Intuitive Machines' decline came despite recent NASA contract awards totaling $20 million. The two contracts cover operations of the Lunar Reconnaissance Orbiter Camera and the ShadowCam instrument on lunar missions.
Intuitive Machines will provide imaging operations, data storage, and mission support under the new agreements. Investors nonetheless prioritized near-term launch risk over multi-year program backlogs when repricing space-sector exposure.
Adjacent space and satellite plays such as AST SpaceMobile (ASTS) also drew renewed attention as traders reassessed risk premiums across launch-dependent business models. The episode underscores how a single high-profile launch failure can reset sentiment across an entire thematic basket.
Whether Monday's losses represent a buyable dip or the start of a broader derating will depend on Blue Origin's investigation timeline and any read-through to competing launch programs across the sector. For now, valuation discipline appears to be reasserting itself after a powerful first-half rally in space-sector equities that had stretched many names to multi-year highs on backlog optimism.
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