Can Rocket Lab Stock Recover If Markets Fall?
RKLB stock has plummeted 33.3% in the last 21 trading days. This sharp decline is directly linked to renewed investor concerns surrounding the Neutron rocket program.
The key issue is a delay in the maiden launch of the Neutron rocket, a vital component of RKLB’s long-term growth strategy. The launch was recently pushed from late 2025 to 2026 to prioritize quality and reliability, which, in turn, triggered worries about near-term growth and rising development costs. This raises the critical question: Is this weakness temporary, or a sign of deeper cracks in the investment thesis? Also, see Inside the Bitcoin Meltdown: How Two Big Institutions Triggered The Crash.
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Before judging its downturn resilience, let’s look at where Rocket Lab stands today.
- Size: Rocket Lab is a $22 Bil company with $504 Mil in revenue, currently trading at $43.62.
- Fundamentals: Last 12-month revenue growth of 54.4% and operating margin of -44.1%.
- Liquidity: Has a Debt to Equity ratio of 0.02 and a Cash to Assets ratio of 0.44
- Valuation: Rocket Lab stock is currently trading at P/E multiple of -97.1 and P/EBIT multiple of -102.0. Rocket Lab is making a significant and aggressive investment in its future, primarily reflected in its Research and Development (R&D) expenses. These funds are primarily channeled into the development of the Neutron rocket and the expansion of its Space Systems capabilities. The scale of this investment is clear: R&D expenses for the last twelve months (LTM) totaled $240 million, which significantly exceeded the company’s $176 million gross profit over the same period.
- Has returned (median) 0.8% within a year following sharp dips since 2010. See RKLB Dip Buy Analysis.
These metrics indicate a Strong operational performance, alongside a Very High valuation – making the stock Relatively Expensive. For details, see Buy or Sell RKLB Stock
That brings us to the key consideration for investors worried about this fall: how resilient is RKLB stock if markets turn south? This is where our downturn resilience framework comes in. Suppose RKLB stock falls another 20-30% to $31 – can investors comfortably hold on? Turns out, the stock saw an impact slightly better than the S&P 500 index during various economic downturns, based on (a) how much the stock fell and (b) how quickly it recovered. Below, we dive deeper into each such downturn.
2022 Inflation Shock
- RKLB stock fell 82.8% from a high of $20.72 on 9 September 2021 to $3.56 on 27 December 2022, vs. a peak-to-trough decline of 25.4% for the S&P 500.
- However, the stock fully recovered to its pre-Crisis peak by 21 November 2024
- Since then, the stock increased to a high of $69.27 on 15 October 2025, and currently trades at $43.62
RKLB Stock Performance During The 2022 Inflation Shock
2020 COVID-19 Pandemic
- RKLB stock fell 3.2% from a high of $10.44 on 16 December 2020 to $10.11 on 31 December 2020 vs. a peak-to-trough decline of 33.9% for the S&P 500.
- However, the stock fully recovered to its pre-Crisis peak by 13 January 2021
RKLB Stock Performance During The 2020 COVID-19 Pandemic
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