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It's Still Early In The New Space Race

Sep. 14, 2021 8:40 PM ETMaxar Technologies Inc. (MAXR), RDW, RKLB, SPIRPL
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  • We've specialized in the space sector since 2017, which is more or less the Dawn of Time in space investing.
  • We've had our wins along the way, in Maxar ($MAXR), Aerojet Rocketdyne ($AJRD), Virgin Galactic ($SPCE) and most recently RocketLab ($RKLB).
  • The sector remains in its early days, with plenty of growth ahead.
  • We lay out some investment ideas for you below.

DISCLAIMER: This note is intended for US recipients only and, in particular, is not directed at, nor intended to be relied upon by any UK recipients. Any information or analysis in this note is not an offer to sell or the solicitation of an offer to buy any securities. Nothing in this note is intended to be investment advice and nor should it be relied upon to make investment decisions. Cestrian Capital Research, Inc., its employees, agents or affiliates, including the author of this note, or related persons, may have a position in any stocks, security, or financial instrument referenced in this note. Any opinions, analyses, or probabilities expressed in this note are those of the author as of the note’s date of publication and are subject to change without notice. Companies referenced in this note or their employees or affiliates may be customers of Cestrian Capital Research, Inc. Cestrian Capital Research, Inc. values both its independence and transparency and does not believe that this presents a material potential conflict of interest or impacts the content of its research or publications.

We'll Keep This One Brief

In our long investment careers we have learned many things, some a result of successes and some a result of, er, not-successes.  And one thing we have learned as a result of both is that when you see long-run secular growth available in a new market, there can be decades of gains ahead.

We feel that way about a couple topics right now. 

In tech, we think that metaverse names are going to drive the next phase of internet evolution.  We'll have more to say to you about that later this month. 

In space, we think that the new commercial vendors are just getting started and though their stock prices are mainly still depressed after SPACs got a bad name, we think this will be receding in the rear view mirror over the course of the next twelve months or so.

If you want a list of space names to consider investing in, we suggest you take a look at:

  • RocketLab (RKLB) - SpaceX junior right now, Mars-venturer in the future
  • Spire Global (SPIR) - low cost Earth observation player in the RF spectrum
  • Planet Labs (DMYQ) - low cost Earth observation player in the optical spectrum
  • Maxar Technologies (MAXR) - high end Earth observation player in the optical spectrum
  • Redwire (RDW) - grab-bag of actual real-world businesses selling actual products to space customers - their new solar arrays are being deployed on the International Space Station for instance.

We could go on.

You can see from the above that the space looks crowded and it would be easy to conclude that there are a lot of vendors here and it's too hard to work out which are most likely to be long run winners.

We respectfully disagree.

Our low cost space sector research service, Cestrian Space Select, helps you sort out the black holes from the supernovae, the low-earth-orbiters from the deep-space-explorers.  Why, for instance, in our view, all three of MAXR, SPIR and DMYQ are all compelling long-term holds despite them apparently competing (clue: they don't).  Why SPIR, though it seems boring just watching ships and weather all day, is a far more valuable business model long term than is RKLB, despite the latter's ability to generate heat and light.

Oh, and why SPIR's $160m acquisition announced today is a great move by the company in our view.

Join us.

$39/month gets you membership, you get all our research notes on the sector and you get heads up by alert to your phone and email before we buy or sell any stock in our coverage universe.  We maintain a list to show you which positions we own and don't own; and we always explain why we're making a buy or a sell, be it long term (most of our work is long term) or the occasional short term play.

If you take the annual option you pay just $299/yr. 

And either which way, if you hate the service, you can quit and only pay for one month.

Learn more about Cestrian Space Select, HERE.

Cestrian Capital Research, Inc - 14 September 2021.

Analyst's Disclosure: I/we have a beneficial long position in the shares of RDW, SPIR, SPIR.WS, RKLB, DMYQ either through stock ownership, options, or other derivatives.

Cestrian Capital Research, Inc staff personal accounts hold long positions in each of the above instruments.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

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