Interest in space-related stocks has been growing exponentially among investors lately. According to an SEC filing on Wednesday, ARK Invest plans to add the ARK Space Exploration ETF (ARKX) to its existing suite of 7 funds. The company is behind such wildly successful ETFs as the ARK Innovation ETF (ARKK) and the ARK Genomic Revolution ETF (ARKG), both of which returned more than 100% in 2020.
Here are some of the top space related stocks that might benefit from these hype:
- Virgin Galactic / Ticker: SPCE
Virgin Galactic is an American spaceflight company within the Virgin Group. It is developing commercial spacecraft and aims to provide suborbital spaceflights to space tourists and suborbital launches for space science missions.
The origins of Virgin Galactic go back to 2004. Co-founder Sir Richard Branson had the inspiration that space could be the next frontier for tourism.
In terms of the market size, it does look like it could be substantial. Even though the price tag for a flight is anywhere from $200,000 to $250,000, there are many people who have the financial means for this. Based on research from Credit Suisse, there are roughly 2 million people across the globe with a net worth of over $10 million. And according to a study from UBS, the spending on space tourism could reach $38 billion by 2030.
Virgin Galactic has recorded key milestones in the course of the previous year, with several test flights and the appointment of new corporate heads. The company is set to complete a couple more tests, fly its Chairman, Sir Richard Branson to space before commercializing its space tourism operation. This is certainly set to stir a pump in SPCE stock and the ETF eventually.
But there are other business opportunities for Virgin Galactic. One is to provide services for NASA. Next, the jet propulsion system could be a source of licensing revenues.
- Boeing / Ticker: BA
The Boeing Company is an American multinational corporation that designs, manufactures, and sells airplanes, rotorcraft, rockets, satellites, telecommunications equipment, and missiles worldwide. BA stock is down more than 50% from its all-time high price back in 2019.
Boeing is one of the original space stocks, Boeing built the first stage of the Saturn V rocket that helped propel Apollo 11 astronaut to the moon in 1969. Now it’s building the Space Launch System rocket at the same facility at the Saturn V rocket in New Orleans.
The SLS is designed to be the most powerful rocket ever, taking astronauts and probes into deep space. But delays and costs overruns have plagued the NASA rocket as the White House applies immense pressure on the space agency to return to the moon by 2024.
Boeing also builds satellites and manages the ISS for NASA.
Boeing will not only benefit from space hype, but also as air travel gains momentum after pandemic passes, there might be airplane shortages and that will definitely have a positive effect on BA stock price as well.
- Lockheed Martin Corporation / Ticker: LMT
Lockheed Martin Corporation is an American aerospace, defense, arms, security, and advanced technologies company with worldwide interests. It was formed by the merger of Lockheed Corporation with Martin Marietta in March 1995. LMT is part of our TOP cheap stocks to buy.
Lockheed Martin (LMT) is a blue-chip stock with a market-beating 3% dividend yield, long-term growth, and a business model built to outlast even a severe economic downturn.
This company operates multiple segments, with its flagship aeronautics programs like the F-35, F-22 and F-16 accounting for approximately 40% of total revenue. Other major programs include combat ships, helicopters, missile defense systems and satellites.
Some Big recent news regarding LMT has been that they have completed assembly and testing of the Orion Artemis I spacecraft and has transferred possession to NASA’s Exploration Ground Systems (EGS) team. Lockheed Martin is the prime contractor for NASA and built the crew module, crew module adaptor and launch abort system. ARK has already bought huge amounts of LMT stock for their ARKQ ETF last week and it’s a good bet that Lockheed Martin will be a big part of Their Upcoming Space Exploration ETF as well.
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