Better Space Stock: Rocket Lab vs. AST SpaceMobile

As launch costs decline and technology advances, the space economy appears to be in the early stages of a strong growth cycle. According to McKinsey estimates, the global space economy is projected to reach $1.8 trillion by 2035.

Two popular space stocks right now are Rocket Lab (NASDAQ: RKLB) and AST SpaceMobile (NASDAQ: ASTS). These two companies are making headway in the space economy: Rocket Lab, with its launch services and space systems businesses, and AST SpaceMobile, which is building a large constellation of satellites to provide connectivity to users worldwide.

If you're considering an investment in either of these stocks, here's what to know.

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Two companies emerging in the budding space economy

Rocket Lab has emerged as a competitor to industry leader SpaceX's launch business. The company was the second-most-used space launch company in the United States last year and has launched 81 times to date, including twice this year.

The company uses a small lift rocket, Electron, to carry small payloads into orbit for customers. It has also developed a medium-lift launch vehicle, Neutron, which it aims to launch sometime this year. Neutron will allow it to carry payloads up to 40 times larger than its Electron launch vehicle, helping it generate significantly larger margins while enabling it to better compete with SpaceX for larger payloads.

Not only that, but Rocket Lab has built a strong space systems business, designing and manufacturing components to support customers' missions to low-Earth orbit and beyond. The company has a substantial backlog (future revenue from contracts not yet fulfilled) for both business segments, totaling over $1 billion.

AST SpaceMobile designs and develops satellites that enable cellphones to use its service and communicate without specialized software or hardware. The company has secured major deals with telecom companies, including AT&T and Verizon Communications, to provide broadband coverage for its customers. The satellite company also announced a $43 million contract award supporting the Space Development Agency through a prime contractor.

Which stock is a better buy today?

Both companies are still pre-profit. Current analyst projections suggest that Rocket Lab is unlikely to achieve profitability until 2027, while AST SpaceMobile is expected to reach profitability no earlier than 2028.

That said, analysts project substantial revenue growth over the next few years. Rocket Lab's revenue could reach $1.5 billion by 2028, up from $600 million in 2025. Meanwhile, AST SpaceMobile's revenue is projected to go from $57 million in 2025 to $1.94 billion in 2028.

AST SpaceMobile still has work to do to put satellites into space and hopes to have 45 to 60 BlueBird satellites in orbit by the end of 2026. In the long term, it envisions 90 satellites to achieve global connectivity. Meanwhile, Rocket Lab had hoped to debut its Neutron launch vehicle in the first quarter this year, but recent setbacks could push back the timeline; investors will get an updated timeline this month.

If I had to pick one stock to buy right now, I'd go with Rocket Lab, because it's already generating steady revenue from its businesses and is expected to reach profitability sooner. That said, both stocks figure to be key players in the long-term growth of the space economy.

Courtney Carlsen has positions in Rocket Lab. The Motley Fool has positions in and recommends Rocket Lab. The Motley Fool recommends Verizon Communications. The Motley Fool has a disclosure policy.