Space Stocks to Buy in This New Era of "Paying Customers"
You know there's change afoot on the final frontier, but how should you take advantage of it? Let's find out with our carefully chosen space stocks.
In the early 2000s, Virgin Galactic began the journey to open up space to paying customers. Finally, in July 2021, Branson and three crew members traveled to Spaceport America, Virgin Galactic's human spaceflight headquarters in southern New Mexico on the VSS Unity.
In the same month, Jeff Bezos, founder of Blue Origin, zipped away from earth on his New Shepard space vehicle. In September, Elon Musk's SpaceX did the same in its civilian-populated Inspiration4 mission on a Crew Dragon spacecraft.
Space tourism is here, thanks to Bezos, Musk and Branson, who have made it possible for anyone with enough money to book a seat on a private spacecraft. If you haven't invested in space flight, what should you invest in?
What Do You Need to Know About the Future of Space Flight?
Before you invest, it's worth taking a look at what's happening with the future of space flight.
Before the trio of billionaires shattered world records, NASA had already begun breaking the mold, changing ideas about only astronauts in space, even going into partnership with SpaceX and Blue Origin.
Tickets for going up into space for about four minutes have a price tag of $200,000 and booking an orbital expedition costs up to eight figures.
As humans continue to explore beyond Earth's sphere, it's not only the manned missions that may line your pocketbook — it's also the new technologies and industries that will benefit from more trips to space.
In 2017, Morgan Stanley and Bank of America Merrill Lynch predicted that the space industry will grow exponentially in the coming decades and reach a market value of $1.1 trillion by 2040 and almost $3 trillion by the middle of the century.
3 Space Stocks to Consider for Your Portfolio
Which space stocks can give you ample opportunities? Let's find out.
Maxar Technologies Inc., headquartered in Westminster, Colorado, provides earth intelligence and space infrastructure solutions in the United States, Asia, South America, Europe, the Middle East, Australia and Canada. It operates through its Earth Intelligence and Space Infrastructure segments and offers earth imagery products and information products as well as online access to imagery and geospatial intelligence platforms. Maxar serves U.S. and other international government agencies, such as defense and intelligence agencies and commercial customers in various markets with space-based infrastructure, robotics, sub-systems and information solutions, including communication and imaging satellites and payloads. It offers platforms for space exploration and hosting instruments for earth science, satellite ground systems, space-based remote sensory solutions and more.
Maxar announced Q4 results as follows:
- Net income from continuing operations of $14 million
- Diluted net income per share of $0.19
- Consolidated revenues of $437 million
- Adjusted EBITDA1 of $113 million
Total revenues remained relatively unchanged as they increased to $437 million, or by $1 million, for the three months that ended September 30, 2021, compared to the same period in 2020.
Virgin Galactic Holdings, Inc., founded by British entrepreneur Richard Branson, and headquartered in Las Cruces, New Mexico, became one of the earliest players in the private passenger space race. An integrated aerospace company, Virgin Galactic develops human spaceflight for private individuals and researchers and manufactures air and space vehicles. The company's spaceship operations include commercial human spaceflight and flying commercial research and development payloads into space. It also designs and develops manufacturing, ground and flight testing and post-flight maintenance of spaceflight vehicles.
In Q3 2021, Virgin Galactic reported that its commercial service was on track for Q4 2022 and had strong ticket sales at $450,000 per seat.
The Unity 22 flight fulfilled several test objectives, including evaluating the cabin and customer experience. Virgin Galactic announced a target of 1,000 reservations and approximately 700 of these 1,000 were sold as of November 8, 2021.
Virgin Galactic's cash position remains strong at approximately $1 billion, which includes cash and cash equivalents of $721 million and marketable securities of $286 million as of September 30, 2021. The company generated $500 million in gross proceeds through the sale of approximately 13.7 million shares of common stock, mainly to expand its spaceship fleet.
The company had $50 million in GAAP selling, general and administrative expenses compared to $31 million in the third quarter of 2020 and GAAP research and development expenses of $36 million, compared to $46 million in Q3 2020.
Adjusted EBITDA totaled $68 million compared to $66 million in Q3 2020 and the company experienced a net loss of $48 million, compared to a $92 million net loss in Q3 of 2020.
L3Harris Technologies Inc., headquartered in Melbourne, Florida, offers defense and commercial technologies across air, land, sea, space and cyber domains through the following segments: integrated mission systems, space and airborne systems, communication systems and aviation systems.
The company's various segments contribute to multi-mission ISR and communication systems, integrated electrical and electronic systems for maritime platforms, advanced electro-optical and infrared solutions, space payloads, sensors and full-mission solutions. The company also contributes to classified intelligence and cyber defense, avionics and electronic warfare, tactical communications, broadband communications, integrated vision solutions and public safety.
L3Harris reported Q4 revenue of $4.4 billion which was down 7% versus the prior year and down 1% on an organic basis. L3Harris also reported 2021 revenue of $17.8 billion, down 2% versus prior year and up 2% on an organic basis.
Its Q4 GAAP net income margin was 11.1% and EPS was $2.46. It held a 2021 GAAP net income margin of 10.3% and GAAP EPS of $9.09.
L3 Harris had a 2021 operating cash flow of $2.7 billion and adjusted free cash flow (FCF) of $2.75 billion. The company returned $4.5 billion to shareholders in share repurchases and dividends in 2021.
Invest in the Final Frontier
Humanity will take giant leaps in just the next decade. Crewed missions to Mars, robotic missions to the far reaches of the solar system and the first interstellar missions means that everything that has been done in history pales in comparison to what we're accomplishing now, so consider getting a lineup of space stocks into your portfolio.
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