Rocket Lab Stock Erases $57 Billion in Value as Headwinds Mount

Rocket Lab (NASDAQ:RKLB) stock broke below a key support level and fell to its lowest point since December 9. The shares dropped to $50.8, more than 66% below their peak for the year. The retreat followed another delay to the company’s Neutron rocket, a move that may lead to higher costs and revenue delay. Rocket Lab Stock Dropped After Neutron Delay RKLB stock continued its strong sell-off last week after the company delayed its Neutron, a project it has been working on for years. Neutron is a reusable medium rocket built to move it beyond the small satellite launch it has always been known for. It aims to compete with SpaceX’s (NASDAQ:SPCX) Falcon 9, with its maximum payload being up to 13,000 kilograms. In a statement this week, Rocket Lab said that it identified an issue that forced it to delay the project’s launch to next year. This is a major disappointment because it has delayed the launch before. Neutron has already secured some major contracts, including a $397 million one to deliver multiple Flatellite spacecraft. Rocket Lab’s retreat has also coincided with a broader decline across the space industry. SpaceX remains 35% below its peak for the year. Planet Labs (NYSE:PL) has dropped more than 77%, while Intuitive Machines (NASDAQ:LUNR) has slipped 80% from its all-time high. Read Also: Nebius Stock Falls After Key Gartner Warning as Short Interest Nears 20% On the positive side, Rocket Lab’s business is doing well, with its second-quarter revenue rising by 62% to $234 million. Its backlog jumped by 137% to $2.36 billion, a trend that may continue in the coming years. Rocket Lab also recently announced the $8 billion acquisition of Iridium, creating a vertically-integrated space company that designs, builds, launches, and operates its own constellations. Most notably, analysts expect that Rocket Lab’s business will continue growing, with its third-quarter revenue expecting to jump 65% to $257 million. Its annual revenue is expected to jump by 60% to $958 million. RKLB Stock Price Technical Analysis Rocket Lab stock chart | Source: TradingView Technicals suggest that Rocket Lab’s shares have more downside to go in the near term. It has dropped below the important support level of $58.18, its lowest level on July 29 and the 61.8% Fibonacci Retracement level. Dropping below that level is usually a sign that bears are prevailing. Rocket Lab has also formed a death cross pattern as the 50-day Exponential Moving Average (EMA) crossed the 200-day EMA. The Average Directional Index (ADX) has moved to 19.5 and is pointing upwards. These technicals suggest that the stock will continue falling, potentially to the 78.6% Fibonacci Retracement level of $35. In the future, however, the stock will likely bounce back as investors buy the dip. Read Also: Broadcom Stock Is Down 35% From Its Peak as AI Bubble Warnings Rise, but Analysts Stay Optimistic Image: Shutterstock