Investors looking to benefit from the burgeoning space industry should hitch themselves to Astra , according to Deutsche Bank. The rocket company went public through a merger with a special purpose acquisition vehicle and officially started trading on July 1 . After rising above $15 per share in its second day of trading, the stock has retreated below $9. However, Deutsche Bank analyst Edison Yu said in a note to clients Tuesday that the stock can bounce back, and initiated coverage with a buy rating. "With an emerging number of private rocket launch companies, we see Astra's differentiation being a focus on developing high frequency, low cost small rockets and associated infrastructure. This approach should enable much broader access to space so companies can more easily commercialize applications," the note said. The firm's $13 per share price target, which is nearly 46% above where the stock closed Monday, would represent a market cap of more than $3 billion. Deutsche Bank said that valuation was in line with other companies in the industry, given Astra's proven ability. Astra rose 4.7% in premarket trading Tuesday. "We think rocket launch companies which are perceived to possess compelling technology and reputable management can fairly 'easily' garner a low-mid $1bn valuation without having demonstrated orbital ability, based on recent private market fundraising rounds. After reaching orbit, the valuation likely increases 2-3x depending on circumstances," the note said. If Astra can prove to have success with satellites or other parts of the space industry, the company could be even more valuable, Deutsche Bank said. -CNBC's Michael Bloom contributed to this report.
Astra launches Rocket 3.1 from Kodiak, Alaska on Sept. 12, 2020.
John Kraus | Astra
Investors looking to benefit from the burgeoning space industry should hitch themselves to Astra, according to Deutsche Bank.
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