Why Redwire Stock Popped on Tuesday
Key Points
In two days, Redwire announced two factory expansions.
Originally a space company, Redwire is also a defense contractor today.
Redwire's free cash flow is running negative.
- 10 stocks we like better than Redwire ›
Redwire Corporation (NYSE: RDW) stock investors had an amazing day Tuesday, with their stock closing up 9.4% on a couple of announcements suggesting Redwire has momentum:
Yesterday, Redwire announced a "major expansion" of its Huntsville, Ala., factory for building Stalker UAS armed surveillance drones.
Missed Nvidia in 2009? This Rare Signal Is Flashing Again. In 2009, a "Double Down" signal flashed for a little-known chipmaker called Nvidia. For the first time in years, that same "Total Conviction" signal is flashing for a company 1/100th the size of Nvidia. Continue »
And today, Redwire opened a second factory in Georgetown, Ind., to produce "microgravity payloads" for operation in space.
Image source: Getty Images.
Redwire's a space stock -- and a defense stock, too
Redwire started off life as a space company, specializing in developing space "infrastructure" -- not rockets or satellites per se, but primarily equipment for use in space, on board satellites and space stations.
Early last year, Redwire pivoted hard into the defense sphere, spending $925 million to acquire drone company Edge Autonomy and its portfolio of artificial intelligence-enhanced military drones.
This week's twin announcements confirm Redwire's interest in keeping both these businesses -- and indeed expanding them. The Huntsville factory will add 164,000 square feet for both space and defense production. Redwire plans to complete construction by Q4 2027.
Meanwhile, in Indiana, Redwire just opened an additional 30,000 square feet of space to develop microgravity payloads for conducting experiments and manufacturing goods in Low-Earth Orbit and on the moon. Redwire noted in its announcement that the focus of the Georgetown facility will be "pharmaceutical/biotech innovation."
Redwire's biggest risk
Unmentioned in either announcement, I fear, is the cost of expanding and building the facilities -- but that's definitely a number investors should watch out for. Redwire reported losses of $300 million over the last 12 months and is burning cash at the rate of about $155 million per year.
Building new factories may be necessary as Redwire scales up. It's not doing the company's bank account statement any favors, though.
Should you buy stock in Redwire right now?
Before you buy stock in Redwire, consider this:
The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Redwire wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.
Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $364,562!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,247,668!*
Now, it’s worth noting Stock Advisor’s total average return is 894% — a market-crushing outperformance compared to 207% for the S&P 500. Don't miss the latest top 10 list, available with Stock Advisor, and join an investing community built by individual investors for individual investors.
See the 10 stocks »
*Stock Advisor returns as of July 21, 2026.
Rich Smith has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
Recommended Articles
