Needham reaffirmed its Buy rating on Rocket Lab USA, Inc. (NASDAQ:RKLB) and increased its price target from $28 to $32 on May 28. The adjustment was announced following the news that Rocket Lab will acquire Geost LLC, a company specializing in infrared and electro-optical payloads for national security.
The two companies share a defense clientele, which includes the Space Force, the U.S. Air Force, and the Space Development Agency (SDA). Notably, Rocket Lab USA, Inc. agreed to acquire Geost at a purchase price of $275 million, with $125 million in cash and $150 million in RKLB shares, along with the possibility of an additional $50 million in cash earn-outs.
Needham views the acquisition as a major step for Rocket Lab USA, Inc., boosting its position as a leading defense and aerospace contractor. According to the firm, Rocket Lab’s enhanced position could prove essential as it competes for a number of government projects, including the Golden Dome project.
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