Why Rocket Lab stock reversed from a massive pre-market rally to 8% decline

Rocket Lab stock (NASDAQ: RKLB) plunged 8% on Monday despite the company’s successful RAISE-4 mission for Japan’s space agency JAXA.

The stock dive is seen as a counterintuitive pullback that analysts are framing as profit-taking rather than a vote of no-confidence in the mission.

The Rocket Lab stock declined despite the operational victory, sliding from its premarket highs of around $63.07 to close lower as investors cashed in gains following a 141% year-to-date surge.

The disconnect between mission success and stock weakness highlights the volatility inherent in high-growth space equities, particularly when valuations have compressed significantly after steep prior rallies.

What happened: Mission success meets market pullback

On Sunday, Rocket Lab successfully lifted off from New Zealand’s Launch Complex 1, deploying eight technology demonstrations for Japanese private companies, universities, and research institutions aboard JAXA’s RAISE-4 satellite.

The mission marked Rocket Lab’s 19th launch of 2025 and the company’s first dedicated contracted launch for JAXA.

The second follow-on mission is slated for Q1 2026.

Operationally, the mission was a success, the kind that should have fueled post-market enthusiasm.​

Instead, traders elected to pare positions. The stock opened higher in premarket trading on December 15 at around $63.07, up roughly 2.5% from its prior close.

But once regular trading commenced, sell pressure mounted.

By mid-day, shares had turned negative, sliding to around $58 levels despite the headline victory.

Trading volume spiked, suggesting both institutional and retail holders were exiting positions established at lower levels in prior months.

The selloff highlights a familiar market dynamic: after Rocket Lab surged 141.4% from April through mid-December, profit-taking was inevitable.

Some analysts attributed the move to technical overbought conditions, noting that the stock’s Stochastics indicator had climbed to 92.42, signaling potential near-term exhaustion.

Short-term traders who loaded shares during Rocket Lab’s earlier 25-percent weekly rally now locked in gains, even as long-term bulls viewed the dip as noise.

Rocket Lab stock: Why analysts still see upside

The critical point for investors: sell-side analyst coverage remained constructive despite the one-day stumble.

The RAISE-4 mission success validates Rocket Lab as a reliable partner for government space agencies, a credential that opens doors to the largest contracts in the industry.

JPMorgan, Bank of America, and Citigroup have all reiterated “Buy” ratings, citing steady government demand and Rocket Lab’s competitive moat in the dedicated small-launch segment.​​

The broader investment thesis hinges on two pillars: sustained Electron launch cadence and Neutron development.

Analysts project Rocket Lab could generate $1.3 billion in annual revenue and $113.4 million in earnings by 2028.

Consensus price targets cluster in the $50–$65 range, though several shops have pegged their 12-month outlooks higher, reflecting confidence that Neutron milestones will rerate the stock upward.

The near-term risk is clear: execution on Neutron remains critical, and any timeline slippage will test investor patience.

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