Historically, space exploration has been tied to high cost and high complexity, making commercial space prospects unrealistic in the past. The Space Shuttle was the first partially reusable vehicle, but between recovery and reuse, reusable vehicles take roughly 60-70 days of cash-burning maintenance and refurbishment.
That makes it hard to unlock space at economies of scale. To make it even remotely thinkable, you need full and rapid reusability, implying complete recovery of all rocket stages, that too in a cost-effective manner, and a duration of about 24 hours between recovery and reuse. This is what SpaceX is trying to achieve with its Starship program after it already achieved cost-effective partial reusability with Falcon 9.
The Starship program moved one step closer to its goal when, on October 13, SpaceX successfully conducted a test flight and recovered the booster rocket, with its Mechazilla launch tower catching it with its two arms when it returned to land. The company planned to capture the upper stage (the starship itself) with the Mechazilla feat in early 2025, but test flights in 2025 so far did not aim for that.
SpaceX isn’t counting on it for its survival. The company, already valued at $210 billion as of mid-2024, while eying a $400B valuation in 2025, has sustainable streams of revenue from its Starlink constellation program and Low-Earth-Orbit (LEO) missions.
It’s safe to say SpaceX has no real competition and virtually owns the space industry because of its exceptional operational efficiency delivered through cost-efficient partial reusability, larger rockets, and vertical integration, with the biggest factor being the nailing down of self-landing and partial reusability.
Moreover, SpaceX’s high launch cadence enables it to spread out operational and maintenance costs more efficiently as well. Frequent launches mean that fixed costs, like labor and infrastructure, are amortized over a high number of missions, driving down the cost per Kilogram.
These factors have allowed it to lead the market in pricing. As of 2022, data by CSIS Aerospace Project, Falcon 9 and Falcon Heavy offer the lowest cost per Kilogram of payload to LEO, with Heavy costing $1,500 per KG as of 2018 and Falcon 9 costing $2,600 per kg as of 2010. For perspective, two rockets by other competing companies – Minotaur IV and Electron – cost $30,500 and $23,100 per kg as of 2010 and 2018, respectively. If the company realizes its Starship program, the high reuse could bring the cost down to an estimated $10-20 per kg. These factors put the company in a position so dominant, it can effectively decide its own margins.
The difference leads most customers to SpaceX. The analytics firm BryceTech reported that in H1, 2023, SpaceX launched over 80% global payload into orbit. Independent estimates suggest the share has reached approximately 90% by the year end, like Musk had projected in May 2024.
For the rest of the industry, the challenge is to compete with a company that is virtually the industry. Some companies are consolidating their position in the industry first in very narrow domains relatively untapped by SpaceX, like smaller rockets for test flights and responsive missions, or rockets optimized for certain orbits like GEO. Other companies, like Blue Origin, are trying to take on SpaceX head-on. Although there are a lot of obstacles to that, the ultimate one is the cost. Blue Origin now claims its New Glenn costs about $68 million per launch (close to cost‑parity with Falcon 9, while offering twice the payload), though its first booster landing attempt failed.
While the stars are perfectly aligned for SpaceX, many companies in the rest of the industry are struggling. Space is capital-intensive with a higher burn rate than most industries. Many startup companies that went public have been struggling to break even, trading at a lower price than their initial listing price and receiving delisting notices.
The investment in the industry was also in decline. According to data by Crunchbase, space received a significant capital boost in 2021 like most other tech industries, with venture capital investment in space startups increasing by 266% from the year prior.
It fell by 24% in 2022 in the wake of interest rate policy tightening, and in 2023, capital inflow declined by 54%. However, according to Space Capital, the industry has made a recovery in 2024 with 30% year-over-year capital growth.
With the strategic policy-easing measures, the space industry might get the thrust it needs to skyrocket once again as if it was 2021. ARK’s ETF ARKX exposed to space companies is up 78% since September 18, 2024, when the Fed made its 50 basis-point cut.
If you want exposure to SpaceX, you can look into ARK Venture Fund ARKVX. SpaceX makes up 12% of the fund’s portfolio as of July 2025. With all these things in mind, let’s head to the list of space stocks that analysts are bullish on.
A satellite in the night sky, glimmering with the promise of aerospace exploration.
Our Methodology
For our list, we sifted through ETFs and narrowed down to space stocks that were either pure-play or significant in the space industry. We then ranked these stocks based on the number of hedge funds holding stake in them as of Q1, 2025.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
10. Redwire Corporation (NYSE:RDW)
Number of Hedge Fund Holders: 10
Redwire Corporation (NYSE:RDW) is one of the best space stocks to buy according to hedge funds. On July 16, Canaccord analyst Austin Moeller reiterated a Buy rating on Redwire, while nudging the 12‑month price target from $20 to $21, implying roughly a 24% upside from current levels, which were around $17.70 at the time.
Moeller emphasized Redwire’s expanding capabilities beyond space, especially its Edge Autonomy drone tech. The VXE30 Stalker UAS, soldier-friendly with 8+ hours of flight endurance and classified on the DoD’s Blue UAS list, underpins the firm’s belief in growing defense adoption. The analyst also highlighted how Redwire is locking in federal and NATO contracts using its drone-satellite end‑to‑end encrypted communication systems, including Link‑16 antennas and Mako satellite buses, giving it a competitive edge in secure ISR and tactical applications.
This fresh reiteration shows confidence that the Edge acquisition shifts Redwire’s profile from pure components provider to an integrated space-and-defense platform specialist, capitalizing on rising aerospace budgets and strategic infrastructure investments. The modest price‑target bump reflects measured optimism, balancing execution risks with strong growth potential.
Redwire Corporation (NYSE: RDW) is a multi-domain space and defense technology integrator supplying advanced spacecraft components, deployable solar arrays, and robotics to NASA, DoD, and allied space agencies; following its 2025 acquisition of Edge Autonomy, it now also delivers unmanned aerial systems and ISR capabilities to U.S. and NATO defense forces.
9. Kratos Defense & Security Solutions Inc. (NASDAQ:KTOS)
Number of Hedge Fund Holders: 17
Kratos Defense & Security Solutions. (NASDAQ:KTOS) is one of the best space stocks to buy according to hedge funds. On July 8, 2025, Cantor Fitzgerald initiated coverage of the stock with a Buy rating and a bold $60 price target, citing Kratos’ leadership in unmanned aerial systems and its central role in hypersonic test infrastructure.
The report specifically highlighted the company’s expanding portfolio of affordable combat drones, such as the XQ-58A Valkyrie, and its pivotal contracts under the MACH-TB hypersonic testbed program. This comes just days after multiple other firms, including Benchmark, Stifel, and RBC, reaffirmed or upgraded their bullish stances, with price targets ranging between $50 and $54.
Analysts appear to be coalescing around Kratos’ reputation as a rare defense-tech play: agile, innovation-driven, and deeply embedded in programs that are both high priority and high margin. That confidence got another jolt on July 16, when Airbus announced a partnership with Kratos to supply Valkyrie drones, equipped with Airbus mission systems, to the German Air Force. Deliveries are expected by 2029, but the contract solidifies Kratos’ growing international relevance in the unmanned combat space.
Founded in 1994 and headquartered in San Diego, Kratos specializes in disruptive defense technologies, including autonomous aircraft, hypersonic test vehicles, missile defense systems, and satellite ground infrastructure. Its customers include the U.S. Department of Defense, NATO allies, and major primes looking for cutting-edge solutions without the legacy bloat.
8. Intuitive Machines, Inc. (NASDAQ:LUNR)
Number of Hedge Fund Holders: 21
Intuitive Machines, Inc. (NASDAQ:LUNR) is one of the best space stocks to buy according to hedge funds. On July 16, 2025, the Houston City Council approved a strategic lease amendment for Intuitive Machines, adding 3 acres and extending its lease at the Houston Spaceport by 5 years to enable a $12 million expansion.
The project includes new production and testing facilities, plus support infrastructure, to scale lunar lander assembly, Earth‑reentry systems, Lunar Terrain Vehicle development, and NASA’s Near Space Network Services.
Intuitive Machines, headquartered in Houston, is a commercial space infrastructure firm behind the Nova‑C lunar lander series (Odysseus, Athena), spacecraft cargo systems, in-space communication services, and emerging work in lunar mobility and re-entry platforms under NASA and DoD contracts.
7. AST SpaceMobile, Inc. (NASDAQ:ASTS)
Number of Hedge Fund Holders: 22
AST SpaceMobile (NASDAQ:ASTS) is one of the best space stocks to buy according to hedge funds. On July 10, Clear Street began coverage on AST SpaceMobile (NASDAQ: ASTS) with a Buy rating and a $59 price target, setting it apart from the consensus range of $30–$64.
Clear Street’s bullish thesis hinges on AST’s plan to start reliable commercial service by 2027, with a projected breakout year in 2028, forecasting $2.3 billion in revenue and $1.3 billion in adjusted EBITDA. Translating that, their $59 target equates to about 19× 2028 EBITDA or 11× revenue, based on a 10‑year discounted cash‑flow model.
This endorsement follows earlier support from Roth MKM (Buy) and stands in contrast to Bank of America’s neutral stance. Clear Street also pointed to AST’s strong financial footing; liquidity bolstered by a current ratio north of 10, and key strategic partnerships with Verizon, AT&T, Vodafone, and Rakuten.
AST SpaceMobile is building the first space-based cellular broadband network that works directly with standard, unmodified smartphones. Unlike typical satellite internet, their tech beams signals straight into your handset, eliminating the need for special gear. Backed by major carriers, AST aims to connect underserved populations worldwide and go live commercially by 2027.
6. Planet Labs PBC (NYSE:PL)
Number of Hedge Fund Holders: 23
Planet Labs (NYSE:PL) is one of the best space stocks to buy according to hedge funds. On July 1st, the company announced a €240 million multi-year satellite services contract with the German government, one of the largest in its history.
The deal includes direct downlink from its next-generation Pelican satellites, high-resolution SkySat imagery, and AI-enhanced surveillance tools, specifically designed for security, infrastructure monitoring, and maritime awareness. The services are set to begin in January 2026. Around the same time, Planet revealed four additional wins in the defense and intelligence sector, including an expanded partnership with the U.S. Defense Innovation Unit for Indo-Pacific threat detection, a seven-figure contract with the U.S. Navy for maritime operations, and a NATO surveillance contract focused on early warning systems.
All four were disclosed in a July 1st press release. While analyst updates following the announcement are still pending, firms like Needham, Wedbush, and Cantor Fitzgerald have recently reaffirmed bullish stances, citing strong momentum in Planet’s government and AI verticals.
Planet Labs PBC, founded by ex-NASA engineers in 2010, operates the world’s largest fleet of Earth observation satellites. It provides daily imagery and AI-driven analytics to customers in defense, agriculture, climate monitoring, and urban planning.
5. Rocket Lab USA, Inc. (NASDAQ:RKLB)
Number of Hedge Fund Holders: 31
Rocket Lab USA, Inc. (NASDAQ:RKLB) is one of the best space stocks to buy according to hedge funds. Fresh off a Citi analyst report earlier in July, Rocket Lab’s stock got a solid thumbs-up. Citi’s Jason Gursky maintained a Buy rating and boosted the 12-month price target from $33 to $50, citing the company’s impressive Neutron development and expanding satellite-systems business.
Gursky’s note doesn’t just toss around optimism – it’s backed by a detailed shift in valuation: moving the revenue forecast timeline from 2027 to 2029, projecting ~$2.6 billion in revenue driven by 20 Neutron launches annually, plus robust satellite contracts, especially from U.S. government programs. Citi’s model even factors in ~$50 M in recurring revenue from the pending Geost acquisition, set to close in H2 2025
Rocket Lab USA, Inc. (NASDAQ:RKLB) was founded in New Zealand and now operates out of California. Rocket Lab is primarily known for the small rocket Electron, which is cheap and quick to manufacture and set up, and is also partially reusable. Rocket Lab has successfully carved out a niche for itself in the industry. Small rockets are much more suitable for responsive missions, and while the cost per kilogram is obviously higher than larger rockets, it is offset by agility.
The company has successfully attracted small-satellite-business customers that want tailored mission profiles or don’t want to wait for rideshare to fill up in larger rockets. Furthermore, the company’s Neutron rocket is set to be an alternative to SpaceX’s Falcon9.
4. Iridium Communications (NASDAQ:IRDM)
Number of Hedge Fund Holders: 38
Iridium Communications (NASDAQ:IRDM) is one of the best space stocks to buy according to hedge funds. On July 17, Cantor Fitzgerald reiterated its Overweight rating and set a $40 price target, ahead of Iridium’s Q2 earnings, citing its reliable profitability, even amid tariff pressures, and strong demand from government and enterprise IoT clients.
The firm also praised Iridium’s aggressive share buyback program, L-band network resilience, and expanding Direct-to-Device (D2D) and IoT roadmap, particularly as part of its calendar Q4 rollout.
Founded in 2001 and headquartered in McLean, VA, Iridium Communications operates a global L-band satellite constellation — Iridium NEXT — delivering voice, data, IoT, maritime, aviation, and government connectivity. With ~80 satellites and a 5% revenue CAGR, robust gross margins, and expanding product suites like Iridium Certus and D2D services, the firm stands out in mission-critical communications and Earth-to-device innovation.
3. Northrop Grumman Corp (NYSE:NOC)
Number of Hedge Fund Holders: 54
Northrop Grumman (NOC) is one of the best space stocks to buy according to hedge funds. On June 5, 2025, Northrop Grumman’s SpaceLogistics division successfully integrated a U.S. Naval Research Laboratory–developed robotics payload, complete with dual arms and advanced electronics, onto its Mission Robotic Vehicle (MRV) spacecraft bus at the Dulles, Virginia facility. This isn’t just engineering flex; it’s a milestone on the DARPA-led Robotic Servicing of Geosynchronous Satellites (RSGS) program. The MRV is being primed to inspect, repair, relocate, and even attach life-extension pods to GEO satellites once it launches.
This matters because commercial satellite-servicing in GEO is no longer sci-fi, it’s becoming operational. By enabling satellite longevity and in-orbit upgrades, Northrop positions itself at the center of a burgeoning on-orbit economy. Hedge funds love companies unlocking recurring revenue via infrastructure and tech leadership, and this is textbook.
In short, NOC is not just building rockets and fighter jets. It’s building a space “mechanic” that makes revenue from fixing multi-hundred‑million‑dollar assets as they orbit 22,000 miles from Earth. This robotics integration milestone proves they’re ready to launch that future.
Northrop Grumman is a diversified aerospace and defense powerhouse, designing advanced military aircraft, missile systems, satellites. Its SpaceLogistics arm is pioneering commercial on‑orbit servicing with MRV, pushing the boundary of what’s possible in space infrastructure.
2. Lockheed Martin Corporation (NYSE:LMT)
Number of Hedge Fund Holders: 68
Lockheed Martin (NYSE: LMT) is one of the best space stocks to buy according to hedge funds. On July 11, 2025, Truist analyst Michael Ciarmoli reaffirmed his Buy rating on Lockheed Martin but trimmed the 12-month price target from $579 to $554.
This ~4.3% reduction isn’t a red flag; it reflects nuanced adjustments, not a shift in fundamental confidence. Ciarmoli highlights manageable tariff challenges in both commercial aerospace and defense, supported by a backdrop of robust global defense budgets and strong aftermarket demand.
He also notes Lockheed’s valuation remains attractive: small- and mid-cap defense and space peers trade at a roughly 122% premium to large-caps. Despite the price-target cut, Truist sticks with Buy, signaling belief in the company’s resilience amid macro uncertainties.
Lockheed Martin is a global aerospace and defense giant, designing and producing iconic systems, from F-35 and F-22 fighter jets to advanced missile systems, satellites, and spacecraft, serving U.S. and international military, intelligence, space, and security clients.
1. The Boeing Company (NYSE:BA)
Number of Hedge Fund Holders: 96
Boeing (NYSE:BA) is one of the best space stocks to buy according to hedge funds. On July 3, 2025, Boeing secured a significant $2.8 billion contract with the U.S. Space Force to develop and produce the first two—and potentially up to four—Evolved Strategic Satellite Communications (ESS) vehicles, integral to the nation’s next-generation nuclear command, control, and communications (NC3) architecture in geostationary orbit. This deal underscores Boeing’s vital role in secure, resilient satcom infrastructure for national security.
ESS satellites will inherit proven tech from Boeing’s Wideband Global SATCOM and O3b mPOWER programs, ensuring a low-risk, high-performance deployment. Work is slated through 2033 out of El Segundo, CA, and includes $100 million in initial R&D funding.
Boeing is a global aerospace titan, designing and manufacturing commercial jets (737, 787), military aircraft, satellites, and space tech like the CST‑100 Starliner, plus offering defense, security, and services across commercial and government sectors.
While we acknowledge the potential of BA to grow, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an AI stock that is more promising than BA and that has 100x upside potential, check out our report about this cheapest AI stock.
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