The SpaceX IPO was the biggest in market history — but it triggered a painful selloff in the rest of the space sector. Rocket Lab (RKLB) tumbled nearly 11% on the day SpaceX debuted on Nasdaq, while Firefly Aerospace cratered 19%. Now, KeyBanc Capital Markets says the selloff was overdone and has upgraded both stocks, seeing a compelling buying opportunity in the post-IPO volatility.
KeyBanc analyst Michael Leshock upgraded Firefly to overweight from sector weight, setting a $50 price target — implying 57% upside from Friday’s close. Rocket Lab also received an overweight upgrade with a $135 target, suggesting 32% upside. Leshock’s thesis is straightforward: SpaceX’s $2.1 trillion debut didn’t diminish the commercial space opportunity — it validated it. “Post SPCX IPO-related volatility, we see compelling opportunities across the rapidly growing space sector,” Leshock wrote Sunday. “Given supportive macro, budgets, and increasing institutional interest, we favor well-capitalized commercial space companies with idiosyncratic growth vectors aligned with national security and NASA priorities.” The bank highlights structurally constrained launch supply as a key driver, noting that NASA activity is “accelerating at a pace not seen since the Apollo era,” while the explosion in satellites and space-based applications keeps demand growing.
For retail investors, the setup here is classic “rising tide lifts all boats.” SpaceX’s IPO surge — shares jumped 19% on debut — has put institutional money on notice that commercial space is a serious asset class. That attention is likely to spill over into Rocket Lab and Firefly, both of which have real revenue, national security contracts, and strong analyst support. Rocket Lab is covered by 22 analysts, 17 of whom rate it a buy or strong buy. Firefly has 8 of 10 analysts bullish. Both have rallied sharply over the past six months (Rocket Lab +85%, Firefly +57%) despite the recent pullback. If SpaceX’s IPO becomes the sector’s defining moment — the event that legitimizes the space economy for mainstream investors — then Rocket Lab and Firefly stand to benefit as the most accessible pure-play alternatives for ordinary investors who missed the SpaceX debut or can’t afford its lofty valuation.
