Better Space Stock: AST SpaceMobile (ASTS) vs. Rocket Lab (RKLB)

AST SpaceMobile (NASDAQ: ASTS) and Rocket Lab (NASDAQ: RKLB) are both space-oriented companies that went public through mergers with special purpose acquisition companies (SPACs) in 2021. Both stocks outlasted many of their SPAC-backed peers, but which one is the better space stock to buy in this volatile market?

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What do AST and Rocket Lab do?

AST develops low Earth orbit (LEO) satellites that beam 2G, 4G, and 5G cellular signals to mobile devices. By working with telecom giants like AT&T (NYSE: T) and Verizon (NYSE: VZ), its satellites can reach rural areas that aren't covered by terrestrial cellular towers. It was also recently selected as a prime contractor for the U.S. Missile Defense Agency's SHIELD program.

AST launched its first five Block 1 BlueBird (BB1) commercial satellites in 2024. Last December, it launched its first four Block 2 BlueBird (BB2) satellites, which are 3.5 times larger than its BB1 satellites but process roughly ten times more data. It aims to have 45-60 satellites in orbit by the end of this year, with a long-term goal of expanding that constellation to over 240 satellites.

Rocket Lab develops reusable orbital rockets. It has already launched its flagship Electron rocket -- which carries small payloads of up to 300 kilograms into low Earth orbit -- 81 times for the deployment of more than 248 satellites. The frequency of its launches has also increased, with 6 in 2021, 9 in 2022, 10 in 2023, 16 in 2024, and 21 in 2025. This year, Rocket Lab will introduce its second rocket, the Neutron, to carry heavier payloads of up to 13,000 kilograms.

Over the long term, Rocket Lab plans to evolve into an "end-to-end" space company by expanding its higher-margin Space Systems segment (which produces spacecraft, satellites, and subsystems for other clients), launching more "ride-share" services for third-party payloads, and improving its Photon satellite bus platform, which bumps satellites into their correct orbits.

Which stock is the better investment?

From 2025 to 2028, analysts expect AST SpaceMobile's revenue to grow at a 200% CAGR to $1.9 billion as it expands its satellite constellations. They also expect it to turn profitable in 2027 and grow its net income by about 30 times in 2028.

During those same three years, analysts expect Rocket Lab's revenue to grow at a 38% CAGR to $1.6 billion as it continues to launch more Electron and Neutron rockets. They also expect it to turn profitable in 2027 and grow its net income more than sixfold in 2028.

Both of these space stocks have significant upside potential. However, AST trades at only 16 times its 2028 sales, while Rocket Lab trades at 26 times its 2028 sales. That lower valuation, along with its stronger growth rates, makes it the more attractive space stock right now.

Leo Sun has positions in Verizon Communications. The Motley Fool has positions in and recommends AST SpaceMobile and Rocket Lab. The Motley Fool recommends Verizon Communications. The Motley Fool has a disclosure policy.