Space stocks are some of the hottest bets on the market right now. Thanks to our rapidly advancing technology, space has transformed into a fully inhabitable and more commercialized place for both governments and corporations. And where there’s business, there’s profit. This new industry is attracting the attention of investors, who are eager to explore the potentially lucrative opportunities that space holds.
These three space stocks provide a ticket to the profits that result from the continued exploration and technological use of space. As providers of machines and technology and pioneers of new business opportunities in space, there are no better stocks to get your hands on now for serious profit as the industry grows.
Let’s learn more about these stocks’ newest products and long-term deals with government agencies that have secured their foothold in the space market for years to come.
Leidos Holdings (LDOS)
Leidos Holdings (NYSE:LDOS) is a defense company that specializes in IT-based services for space technology and programs. Some of Leidos’s biggest customers are government agencies that work in space, such as NASA, the FBI, and the U.S. Army.
The company has a history of investing significantly in expanding its services and capabilities into space. In 2020, Leidos spent $1.65 billion on Dynetics. Dynetics specializes in engineering and IT consulting and has a history of working closely with government agencies on the most challenging, technologically advanced missions.
Thanks to its expansion efforts, Leidos now has a firm grip on space-related tech such as payloads, mission communication systems, cargo provisions, and related hardware. These efforts have paid off, as continued business with huge customers like NASA has taken Leidos to new heights.
In its most recent quarter, Leidos smashed estimates for revenue and EPS. The company reported a 7% increase in revenue year over year and net bookings of $3.7 billion for Q1. With a backlog of $36.6 billion, the company has plenty of cash and leeway for continued investments in space and further expansion. Thus, it is an excellent buy for investors looking to get into space.
Virgin Galactic Holdings (SPCE)
Virgin Galactic Holdings (NYSE:SPCE) is leading the race for the massively popular space tourism business. The company completed its public release following a merger between famous investors Richard Branson and Chamath Palihapitiya.
While this company has yet to be able to launch any passenger rockets into space, it already has a long list of reservations from wealthy individuals worldwide. Initially, the company set out to launch its first spacecraft in 2020 but could not meet its goal.
However, this stock is so exciting because of its incredible potential once it sees lift-off. More than 700 passengers worldwide have already put their names on the waiting list. The approximate cost for each passenger is over $400,000. The potential cash flow is undeniable.
Virgin Galactic recently announced plans to begin Delta-class flight service in 2026. The craft is projected to hold six passengers and complete eight monthly flights. Virgin Galactic will have a monthly revenue potential of just shy of $29 million a month.
If you can stomach some risk and have faith in its ability to make this plan a reality, now is a great time to get on board.
Lockheed Martin (LMT)
Lockheed Martin (NYSE:LMT) is one of the most successful companies in space technology. It provides satellites and missiles to government agencies like NASA and the Department of Defense. However, the company has commercial ventures and does not limit itself to government customers.
Earlier this year, Lockheed Martin won a contract with aircraft manufacturing giant Boeing, securing its position at the forefront of satellite technology and design. For its other prominent space offerings, missiles, the company has the most advanced hypersonic technology in the field and secured a large contract with the U.S. Army for its tech.
The space department accounted for 19% of net sales in the most recent quarter, and the company saw a net earnings of $6.39 per share. Thus, with a secure space position and many other solid revenue streams, Lockheed is a fantastic investment for investors this year.
On the date of publication, Joel Lim did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
