In this piece, we will take a look at the 12 best space stocks to buy according to hedge funds. If you want to skip our introduction to one of the hottest industries, then you can take a look at the 5 Best Space Stocks To Buy According To Hedge Funds.
Most of the debate surrounding the stock market this year has focused on artificial intelligence stocks, and rightly so when we look at the 12 month share price performance of key players in the industry such as Microsoft Corporation (NASDAQ:MSFT) and NVIDIA Corporation (NASDAQ:NVDA), one sector that has been the most turbulent this year has been space.
Since there is only handful of pure play space companies with beefy share prices or sufficient liquidity, space stocks generally do not receive as much media coverage as other sectors such as consumer technology and oil and gas. This is further bolstered by the fact that aerospace exploration has primarily been a government funded venture for most of its history. The Space Race of the 1970s, which culminated with the end of the Apollo program saw the National Aeronautics and Space Administration (NASA) pay private companies to develop complex industrial equipment like a launch vehicle (commonly known as a rocket) or shuttles.
Over the course of time since the end of the Apollo program and the Space Shuttle era, space stocks started to make their first moves. While these days private companies can rightfully claim to operate some of the most technologically advanced vehicles in the world, back then space stocks were limited to satellite companies. In fact, while it’s still a NASA contractor and a space stock because of its rockets and crewed spacecraft, The Boeing Company (NYSE:BO) is also one of the first space stocks to trade on the market. This is because the course of Boeing’s long history has also seen the U.S. aerospace giant acquire the space division of the now RTX Corporation (NYSE:RTX) owned American defense contractor The Hughes Company. Hughes’ Syncom satellite was the first geosynchronous communications satellite sent into orbit. There’s another decades old space stock on our list and you can find it as you scroll through.
This year, one space stock has made the news on the market and as well as in general press coverage. This stock belongs to the Houston, Texas based aerospace and defense firm Intuitive Machines, Inc. (NASDAQ:LUNR). Intuitive Machines’s Nova C Odysseus lunar lander launched on a SpaceX Falcon 9 rocket earlier in February 2024 from NASA’s Kennedy Space Center in Florida. Before Odysseus, the privately held Pittsburgh, Pennsylvania based Astrobotic’s Peregrine lunar lander had attempted to be the first U.S. Moon lander since the Apollo program, but the spacecraft failed soon after orbit.
So, hopes were high for Nova C, and since the lander is one of the few in the world that uses a methane powered rocket engine for its journey, it was slated to land on the Moon in just a week post launch. As the launch was successful and Intuitive Machines, Inc. (NASDAQ:LUNR) confirmed that it had separated from the second stage of the SpaceX Falcon 9 rocket in space, the space stock soared. It jumped from $4.98 on the day of the launch to touch nearly $11 over the course of the next few trading days. The jump in Intuitive Machines’ share price underscored the potential of successful space missions and untapped investor eagerness to buy space stocks.
However, this rise to glory would prove to be short lived and truly underscore the fragility of space exploration – one of the riskiest endeavors in the world. In a press conference after the lander touched down, Intuitive Machines, Inc. (NASDAQ:LUNR)’s management shared that oversight during final checkouts meant that Odysseus’s landing sensors would not be online for landing. Consequently, engineers had to jerry rig a NASA payload on the lander to provide it with guidance, a procedure that led to (but might not have exclusively contributed to) the lander tipping over during landing. Instantly, the stock dropped by 30% in the aftermarket, and on the day the markets opened after the weekend, the shares reversed almost all price gains made post launch. Will hedge funds continue to hold Intuitive Machines, Inc. (NASDAQ:LUNR) stock after the lunar lander oversight? You can check in next quarter to find out.
With this chilling example demonstrating the fragility of investing in space stocks, we nevertheless decided to see what the hedge funds were doing. Some of their top space stocks as of December 2023 are Telesat Corporation (NASDAQ:TSAT), Lockheed Martin Corporation (NYSE:LMT), and The Boeing Company (NYSE:BA).
A close-up of an antenna, its intricate designs a testament to the company’s expertise in space infrastructure.
Our Methodology
To make our list of the best space stocks, we ranked all publicly traded firms that either directly operate in the space industry or are major contributors to exploration efforts and the satellite industry by the number of hedge funds that had bought the stocks as of Q4 2023 end.
For these best space stocks, we used hedge fund sentiment. Hedge funds’ top 10 consensus stock picks outperformed the S&P 500 Index by more than 140 percentage points over the last 10 years (see the details here). That’s why we pay very close attention to this often-ignored indicator.
12 Best Space Stocks To Buy According To Hedge Funds
12. Spire Global, Inc. (NYSE:SPIR)
Number of Q4 2023 Hedge Fund Shareholders: 8
Spire Global, Inc. (NYSE:SPIR) is an American company headquartered in California. It serves the needs of aviation, weather monitoring, and other industries through its aircraft tracking satellites. The firm scored a win in February 2024 when it was awarded a multi million dollar contract in Europe for its safety products.
By the end of 2024’s final quarter, eight out of the 933 hedge funds covered by Insider Monkey’s research had bought Spire Global, Inc. (NYSE:SPIR)’s shares. It joins Lockheed Martin Corporation (NYSE:LMT), Telesat Corporation (NASDAQ:TSAT), and The Boeing Company (NYSE:BA) in our list of the best space stocks to buy according to hedge funds.
11. AST SpaceMobile, Inc. (NASDAQ:ASTS)
Number of Q4 2023 Hedge Fund Shareholders: 8
AST SpaceMobile, Inc. (NASDAQ:ASTS) is a telecommunications company that owns and operates a space based network. Amidst a growing interest in space based telecommunications after the success of SpaceX’s Starlink constellation, AST SpaceMobile, Inc. (NASDAQ:ASTS) won a contract from a U.S. contract in February 2024 for its low Earth orbit (LEO) satellites.
During 2023’s December quarter, eight out of the 933 hedge funds profiled by Insider Monkey were AST SpaceMobile, Inc. (NASDAQ:ASTS)’s shareholders. Sander Gerber’s Hudson Bay Capital Management was the firm’s biggest investor due to its $4.5 million investment.
10. Virgin Galactic Holdings, Inc. (NYSE:SPCE)
Number of Q4 2023 Hedge Fund Shareholders: 9
Virgin Galactic Holdings, Inc. (NYSE:SPCE) operates a space plane launched by its proprietary aircraft. Even as Intuitive Machines, Inc. (NASDAQ:LUNR)’s shares dropped in late February, Virgin Galactic Holdings, Inc. (NYSE:SPCE)’s stock jumped by 3% on the day news hit that Citigroup had held a $1.37 million stake in the firm.
After digging through 933 hedge fund holdings for last year’s December quarter, Insider Monkey found that nine had invested in Virgin Galactic Holdings, Inc. (NYSE:SPCE). Israel Englander’s Millennium Management was the largest shareholder among these as it held $6.7 million worth of shares.
9. Planet Labs PBC (NYSE:PL)
Number of Q4 2023 Hedge Fund Shareholders: 11
Planet Labs PBC (NYSE:PL) is a satellite imaging and tracking company headquartered in San Francisco, California. A boom in global demand for satellite imagery and associated products has served it well since the firm has beaten analyst EPS estimates in all four latest quarters.
As of December 2023 end, 11 out of the 933 hedge funds covered by Insider Monkey’s research had invested in Planet Labs PBC (NYSE:PL).
8. Intuitive Machines, Inc. (NASDAQ:LUNR)
Number of Q4 2023 Hedge Fund Shareholders: 12
Intuitive Machines, Inc. (NASDAQ:LUNR) is the space stock that’s been all the news lately. You’d know why its shares dropped by more than 15% on Monday, February 27th if you read the introduction to our list of the best space stocks.
During last year’s fourth quarter, 12 out of the 933 hedge funds tracked by Insider Monkey had bought Intuitive Machines, Inc. (NASDAQ:LUNR)’s shares.
7. Terran Orbital Corporation (NYSE:LLAP)
Number of Q4 2023 Hedge Fund Shareholders: 13
Terran Orbital Corporation (NYSE:LLAP) is an American satellite operator and manufacturer headquartered in Boca Raton, Florida. The firm was out with some good news for investors in February 2024 when it revealed that a lunar satellite manufactured for a customer had completed 450 days of journeying around the Moon.
Insider Monkey dug through 933 hedge fund holdings for 2023’s December quarter and found 13 Terran Orbital Corporation (NYSE:LLAP) shareholders.
6. Rocket Lab USA, Inc. (NASDAQ:RKLB)
Number of Q4 2023 Hedge Fund Shareholders: 13
Rocket Lab USA, Inc. (NASDAQ:RKLB) is the first rocket manufacturer on our list of the best space stocks. It’s also one of the more successful space companies of its kind, and the shares soared on the day after it announced a new contract with the highly secret National Reconnaissance Office (NRO).
13 out of the 933 hedge funds part of Insider Monkey’s Q4 2023 database had bought and owned Rocket Lab USA, Inc. (NASDAQ:RKLB)’s shares. Along with Telesat Corporation (NASDAQ:TSAT), Lockheed Martin Corporation (NYSE:LMT), and The Boeing Company (NYSE:BA), it is a top space stock to buy.
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Disclosure: None. 12 Best Space Stocks To Buy According To Hedge Funds is originally published on Insider Monkey.