hello guys and welcome back to a new episode of Rocket lab weekly we are at the unbelievable number of 50 freaking episodes of 50 straight weeks of uh doing rocket lab weekly I'm here with practically my co-host Matt Farley um and this is just us two it's I I would say that this is the normal rocket lab weekly just just you and me talking about rocket lab always good when that happens man can't complain that exactly and because we're at 52 week highs I was going to wear my special party glasses and I freaking lost them I I can't find them but I still have this which is a shirt that I got from Curtis uh and I'm really a sucker for these I'm so happy that he sent me this stuff I think you are also getting some stuff yeah I I've uh thankfully received it it's just downstairs um I forgot to bring get upstairs so I need to do that at some point next week we on the on the 52 we episode so how how has your week been on the portfolio really good uh I need to update my tracker um right now it's showing that I'm at all-time Highs but I know that's probably not the case I mean I've sold out out of a few things and invested in a few things so the tracker is a little bit out of date but I mean I wouldn't be surprised of I'm still kind of at alltime Highs but the goal I've been trying to get rid of some petty debt um but overall the portfolio is doing rather well um rocket lab actually isn't too far off from P tier being my number one position they both have grown pretty expansively in terms of individual parts of the portfolio so like rocket lab I remember people always giving me crap like I can't believe it's only what 2% or 3% of your portfolio well now if you were to consider just the stock positions in the portfolio it's over over 10% at that point and then same thing with P tier so a lot of these positions have grown pretty expansively um and that's okay you know I'm not saying that I'm going to trim them or anything of the like um but I just think it's pretty funny you know that that's kind of the goal right you get some of these decent portfolio waiting something that you're comfortable with and once they start taking off then they end up becoming a pretty decent Siz part of your portfolio it doesn't necessarily mean you have to trim like I know friends that have now their portfolio um when they bought paler at five or six bucks um or whatever it was six or seven bucks and it's grown so expansively they're up 300 some percent in some of these cases like I need to trim I need to trim I'm like you don't need to trim right like you can I guess it all just depends on your investment strategies but um you know I know a lot of people that were starting to trim hoping to buy back rocket lab below five bucks and even you the other day were like why are you selling puts at five 50 or whatever it was right um and I was like the price is what the price is right you can't guarantee what the price will be um tomorrow and so sometimes when you get the opportunity you just got to take it and I'm curious what those contracts are actually up to uh let me see I might have actually closed them out no I still got them uh they're 70% profit that's super nice that's super nice I might buy those back actually because there's only did I already buy them back in my personal portfolio hold on yeah anyway looks like I bought a lot of them back somebody's asking where is the next pullback 650 and it's like I don't know we were just talking about how hard it is to um how hard it is to uh know what the stock is going to do in the future and for example I wouldn't have I thought we were going to get a much bigger pullback you were selling put options which is a bull strategy and I was quite surprised that you would do it at at the level that you did it and you ended up being correct and I think the best way to play this is you know know where the stock is overvalued and undervalued and and if we get a huge pullback into the force um then you know you can add very heavily and um if we go up to a time that is uh or a price that is that you think is overvalued you can trim a little bit I I am not a believer in trimming I cannot tell you guys because this week I had two of my stocks which is basically 100% of my more more than 100% of my portfolio because I'm a little bit leveraged because of an accident okay I'm very leveraged I don't know depends on who you're asking Matt thinks I'm very leveraged I I'm I'm quite okay I think I'm more risk averse yeah but uh so I was tweeting about how how well the stocks are doing and I got so many comments of of people people who were saying they regret so much trimming like there was a guy who wrote like I have a better price on Rocket lab than you and I got scared out of the stock and and now I like regret it you know um and and my I'm curious what you think about that that but my answer is if we put in all this work and time to study about a stock I mean I I think in rocket lab like I put put in I mean I it could be thousands of hours now you know like to study this stock and why would it make sense that it jumps 20% and then I sell out like I I'm not in it for this 20% jump I wanted to find a company that um you know I can be invested in the next 20 30 years and and just comfortably own it and and yeah that's why I'm here I think uh you know my thought on that is really understanding why you got invested in the stock in the first place if you got in it to swing it and sell it at $7.50 sense that's your Mo you know you know I can't I can't fault you for that you can make money doing that but to me I invested in the company thinking that it could get to a $50 billion do market cap right and so it doesn't make sense for me to try to take profits at $7.50 or at $7 or even $6 if you know that might make me a penny or two and like I said you can't guarantee what the price is going to be tomorrow but you know you don't know if it's going to go back down to 4 five bucks right it might and you might get that opportunity but to me if that's the case it would be an opportunity to add more not necessarily buy back in um and so I think I've had that happen to me in the past uh you know five 10 years ago now where I sold something too early thinking it'll pull back and um one of two things happens it either doesn't pull back and you end up you know missing the boat entirely but more often than not you end up finding a new shiny object to keep your eyes occupied and you forget about the company entirely um and so you know you you might Keep Your Eye Off the Ball it might have got down to that point um like Tesla for example was a was a prime example of this and you might not get the opportunity or you might not be looking at the opportunity at the right time to buy back in you might have to do work for the next two months and you might not necessarily have the time to to look at the stock market and next thing you know it dips down to four bucks and then rips back up to seven and you had that opportunity to buy and you never did so that's the problem with timing sometimes is you have to be both right on when you sell and when you buy back in and so it's tough in that respect um but to me I always invested in that's why I haven't sold a share of pound here you know um so it's same sort of situation but like I said I mean it really just depends on what kind of investor you are or how you invest in the stock market yeah well said well said cool I think we should start uh rocket lab weekly with with the usual news uh there's some quite exciting things to talk about um yeah we we we take it one by one so the first one is that uh there is a new launch uh scheduled for Tuesday New Zealand time which is probably going to happen or not probably like it's on uh what do you call it it's on Monday hour time uh I'm probably try I'm going to try to live stream this one it's at midnight for me um were you planning on live streaming this one maybe we can do it together uh yeah yeah I was I wasn't really sure when it was going to be uh coming if it was going to be Monday morning or Monday afternoon so nice to see that it's Monday afternoon yeah cool yeah 5:00 P PM mountain time I think that's what curtain Curtis means I don't know which that's Central us time maybe or yeah I'm I'm not an expert on us it's in between yeah it's in between Pacific and um in central yeah yeah cool so this will be the third launch coming up this quarter and it's probably the final launch this quarter uh so we're not doing super hot on uh launches this quarter um and CFO Adam spy spoke at a Morgan Stanley conference where he said that we are currently between 15 to 18 uh launches uh this year uh so that means if I do a quick math uh 443 so that's we're at 11 so between 4 to six or seven more in uh Q4 so what are your thoughts about this is it something to be worried about or it's the rocket lab business model or the fact that they're only getting 15 to 18 or yeah oh you noted the same at the end of the 2q earnings call and so it's nice to see that since that point I guess we're about a month or so on that there hasn't been a a drag further um you know into say only saying 14 to 17 or 13 to to 16 so it's nice that uh for now they're still sticking with the 15 he did uh note though that they're there's definitely a hard stop at 18 right um and it's it they would be happy to get 18 but it seems like that that's going to be the upper end for sure and there's definitely not a chance for a 19th or anything like that so hopefully people aren't getting their hopes up um so I'm curious to see what really happens I think the thing that I'm mostly looking forward to isn't necessarily if they get 15 or 18 the thing I'm mostly looking forward to is if they get the potential haste launch missions out uh before the end of the fourth quarter and the reason being is because I feel like there's going to be a lot less of Need for um not turnaround time but uh really just like lead time I guess is the right term to get those things off into space uh or rather into the air uh if you're talking about haste the reason being is obviously if you're dealing with orbital sort of rockets you're going to have to have a lot different of a payload criteria uh specifications to meet Etc but if you're going suborbital I feel like the Cadence is g to be a lot quicker so to me the thing I mostly care about it might be because I'm more long-term focused but it's really to see if we can get these taste clients happy and it's really been almost uh 18 months since we've well it hasn't been 18 months but it's been over 12 months since we've seen the first taste launch and um it would be nice to start seeing that that Revenue stream start to ramp up yeah that's also one Revenue stream that it's very hard to get information about so it will be nice to you know see it get going and and you know like to be able to think with okay the Cadence the price the yeah I don't think that those will be live streamed launches so um they're normally yeah we are going to see so the next news is uh something that Matt would probably say probably nothing um but we had representative Robert Garcia uh and his Congressional staff visit the rocket lab HQ I think this was not announced for some weeks uh because it said here that they got to see the rocket lab built escaped spacecraft before it went to Florida uh touched a recovered First St electron that journeyed to space and back and visited our engine Development Center to see our Cutting Edge 3D printed our communes engines uh this guy used to be the mayor of Long Beach so he knew rocket lab um you know or he knows rocket lab since many years back and now he returned with his Congressional staff and probably nothing right Matt always probably nothing no I think this continues to show the intertwining of Rocket lab in in the defense side of the business um which I think is is going to be a great Revenue stream going forward yeah exactly exactly uh and hopefully maybe we get some cool government contract soon um yeah okay so we go to the next news okay I have a question so this guy joins rocket lab um at a very interesting position but guess his age like can you guys tell me in the comments what you think this guy's ages I'm going to go first I thought that uh he he was uh yeah like 40 something um I I I want to see what you guess Matt making me feel like I need to go lower but uh I'm going to say 49 okay okay good good someone getss 58 Curtis 55 okay so let's look at his resume and who he is uh so Frank Clan he's a German guy joins rocket lab with more than 30 years of international manufacturing experience so he already has 30 years of international manufacturing experience so I don't know his age but he went to University let's say finished at 22 plus 30 years so he's at least 52 uh so he's looking really freaking good for his age that's that's all I can say um and this guy has been working uh so at Rocket lab he will be leading the company's efforts to scale manufacturing of spacecraft uh launch vehicles and spacecraft components to meet uh growing customer demand for more than A1 billion doll uh backlog orders prior to Rocket lab he served at uh Daimler AG uh which is also known as the mercedesbenz group for 27 years where he led various business divisions including vehicle research trucks cars and Van manufacturing while vice president of Mercedes-Benz operations Mr kin managed Global Productions across 12 production sites that's 12 factories heading up Logistics industrial engineering and the division's quality Department with responsibility for more than 14 ,000 employees globally he also served as president of Magna Ste AG which I think is another German company Automotive industry's largest independent contract manufacturer with an annual turnover of more than $6 billion where he led operations across three continents and 13,000 employees uh globally most recently Mr Klein served as the CEO of rivan Automotive where he helped to transform rivan from a low volume Automotive startup to a high volume premium Electric Vehicle Manufacturer while responsible for 9,000 employees so when I read this resume I I can't help but think that uh we we probably got diluted a lot by hiring him he probably has a very big stock-based compensation package and um what yeah what what do you think was he a good hire is it um is he overqualified because rocket lab has a lot less employees uh a lot less uh production sites I don't think I don't believe we have 12 uh production sites and we don't need um you know like cars you need to manufacture like thousands per week um and you know I I I'll be happy if we put out one Neutron a month or even a week you know that's so it's it's a complete different production um Cadence over so I think um I don't want to be harsh here but I think you're thinking too small uh I think you are forgetting about plenty sites around in Bethesda Maryland the sites in new New Mexico the sites in Long Beach you're thinking about all these potential production lines that might not necessarily only be focusing on launch but might be also producing satellites or solar panels or Star trackers or reaction wheels and each of those is going to have their own assembly line and each of those needs to be optimized to the best of their ability and so uh you know I think that it's prudent to have this especially as you continue to grow um specifically now when you look at the Space Systems business it's growing rather rapidly like last year I think the Space Systems business was lucky to get like a 2030 million quarter um now you're looking at space sub's business pulling up $70 million quarters like it's nothing so um my thought process is going to be averaging a hundred million doll quarters going into 2025 and so to me I think it's prudent to have somebody like this with the experience the thing that scares me a little bit is the rivan side I obviously you can't blame um you know all of the shortcomings potentially on rivan um on this individual and I'd have to look at the tenure right when he joined rivan versus when he exited and and what impact he had on the business but from my understanding is rivan's actually starting to get some Vehicles out pretty well so if he had a hand in that specifically to kind of Turn Around from the slow start that rivan had to getting to them to where they are today you know it all depends on what tenure he had at rivan it it could be a really good opportunity uh and I feel like how do I say this this might be slower Pace than say the car industry but it's a lot more detail oriented right the margin for error I believe is a lot less here for Rocket lab and the Space Systems side of the business than it is particularly at the the automotive side so uh I think I was actually thinking about it when Peter showed that um Hall all filled with like the nine or 10 electrons just waiting to be sent into orbit I was looking I was like I wonder how optimized that floor has been right you saw each line having their own particular kind of tools and everything the like and I was like I wonder if that is as optimized as it needs to be and then here lo and behold within the next couple days they announced this gentleman to to help with respect to to continuing to to grow operations and and things of the like so um I think anybody with that sort of mindset and help will really do well just like how Adam joining has done a phenomenal Jo job of um really bringing a whole wealth of knowledge to the to the financial side of the business being able to bolt on great companies that is obviously excelled rocket lab over the past four to five years I anticipate that this might be the next step up that they need and it'll really allow Peter I think to focus specifically on what a CEO should focus on which isn't necessarily execution of individual projects but really focusing on how to steer the boat and really figure out where the company's going what are the next tranches of business that really will drive rocket lab to be the true end to- end space company that they really desire yeah cool so overall do you give him a thumbs up or thumbs down or yeah with all that definitely big big thumbs down no I'm just kidding um no uh I I I um I'm I kind of liked his uh his his uh from what I've seen the tenure at at Mercedes they are pretty strict right uh German engineering is always generally pretty well received I would want to look specifically more at the tenure as so when he joined rivian versus when he exited um and uh and see yeah yeah yeah cool also yeah Curtis said that there is some uh rumor we don't know how much meat there is I don't know if if you guys come across something please share the link with me um so we can turn into Gossip Girls and see I I normally like how do you call it when it comes to employees I basically I'm very lenient on doing interviews and and what I mean is like I want to see the guys in action and and work with them because I have seen like people having bad interviews and bad CVS and turn out really great and I've seen you know like insanely good CVS turn out to be really bad um so I I I I'm normally like never get too excited I'm like okay let's see the guy in action but just when I read this resume I'm like we got diluted here it's probably not easy to get such a guy to come and join your company um there was one question from the audience that I wanted to see if um you can answer um so there there was this um covered kept call or whatever like when they when they last raised um when when rocket lab raised money in last December and they to not dilute the shares they bought uh like call options somehow that that's what I understood and the first point when they start diluting the shareholders it starts kicking in at $8.8 I think or 8.4 like a little bit over eight and then we get to Max dilution at was it $12 or something like this and somebody in the comments of course when I need it I don't find it no here here it is so he's asking with the convertible offering is there uh more and more dilution if the share price goes higher and higher right or is there a maximum of dilution for me it's not clear so my point is that when we go higher like this dilution kicks in and then like theoretically the shares are worth a little bit less uh so it's like it's a bit hard to theoretically to go higher but I'm not sure how much people think with this or analysts think with this um I I'm curious what you think about this m yeah let me just double check um if I think I think in the Q4 or the q1 earnings call they had like a graph that was showing uh you know like the dilution starts at8 something and it Max dilution and they had like the share numbers that get issued and and it's all and it's also at certain dates right so like maybe we go to $10 and then we have a major pullback back down to five it doesn't mean that we got diluted just because we reached 10 like it needs to be at that price in 2027 or something like this yeah it's been a minute since I've looked so yeah 2024 $355 million convertible note raise uh concerned about shareholder delution um the estimate placed the dilution between 12 and 14% um but I think you're right I think that they took some of that money to basically buy I forget what it was it was like 40 or so million dollars to buy some of the options that allowed them to to basically minimize some of the dilution so there's still some impact for sure but um yeah I think that they went off market and I think they went to a company to to kind of offset it um if that makes sense they did a call Credit spread on on their own offering it's super technical uh yeah I don't know if this helped you um I hope it did um and and yeah if if the share price goes much higher we can definitely have a look back at this and see what was the exact details of this offering cool we go back to the next news uh which is the neutron site is being built out um Peter backck posted nothing like a 680,000 liter of locks for breakfast I don't know why he's having that for breakfast um lc3 Launchpad is taking shape nicely so uh when I was looking at this I was like I don't think that there's much more to the pad uh that is missing because they're doing conc like concreting we know that they need uh locks methane they need so the okay the methane tanks need are they up already maybe um and we know that the neutron is going to have minimal uh launch infrastructure so I think that the pad is it's weird to say but coming to a complete cycle soon and then we only need the rocket hard to hear first so what what what did you think about this uh good yeah no no complaints it's nice to see forward progress um yeah it was it's cool to see the pictures on the ground no cool somebody wrote rocket lab based in Long California said clean will receive an annual base salary of 400,000 and will be eligible for 100,000 sign on bonus and an annual bonus of up to 70% of his uh base pay I don't know where you get this data I hope this is correct uh and is the 70% like stock-based compensation based on on Milestones you think uh a lot of a lot of companies specifically public companies actually provide a lot of bonus pay tied to specific corporate metrics like the stock price going up or or what have you uh and a lot of that is just based off of the fact that these guys have a lot of influence um into the actual price of the company itself and so you'd actually be surprised many CEOs they might you might hear about 20 million $30 million um compensation packages but the majority of that is actually bonuses in stock yeah yes yes yes uh yeah I've seen that too like I heard that uh Tim Tim apple is making I think it was like 100 million and then his actual pay was like 500,000 or something like this and then the rest was uh in in stocks or like like like Elon for example I think he he might only be taking a dollar I don't remember what it was but like Steve Jobs and Bill Gates a lot of those guys and and uh Warren Buffett like a lot of those guys only take a fraction and they majority of the time just get a lot of their bonus paid out in stock and that's just determined by the board right um so a lot of these guys I mean that's where the real money's made they're not making money off of uh off of really having the salary I mean the salary itself is is probably pretty minuscule comparatively uh it's really and it shows up pretty early on within at least corporate structure it's like for me you know I'm eligible for a percentage bonus of of whatever uh but you know the next couple layers above me it really starts to show up in terms of bonus pay and and stock based compensation pay if you meet the metrics and a lot of that's is tied to the fact that you're managing Tire teams or Tire assets uh within an organization so the Su success or failure is really more so on the hands of you and how effective you are as a leader or manager so anyway cool all right so now we go to the next one which is the most exciting news at least for me uh this year uh Adam spice was at a Morgan Stanley conference um and he's so good at these conferences and um I on my channel there's a a video where you can like watch the whole conference if you want to did did you see this Matt no I didn't get the chance to look listen to it I was going to listen to it this morning but then I kept getting phone calls from from people so unfortunately wasn't able to to take it no no problem there is a summary here by space talks uh which I think sums it up very good and then I just have a few comments because yeah there was something that Adam spice said there that made me instantly regret ever selling call options on my on my stocks and I'm like okay I get out of these call options and then that's it I only want to hold the stocks um so it looks like their average selling price for electron is currently going up to uh $8.2 million which is very good uh news they say haste is the fastest growing part of electron's launch portfolio I don't know if that's PR because um how do you call it you know like if you sold 36 uh L electrons and then you started with one haste and then you become like then you sell like five others then it's like a 500% increase and then you know to sell to have a 500% increase on your um Legacy electron I don't know if you can call it that you would have to sell like 150 launches so it's it's kind of like d obviously Hast is the um well I'm just relating it back to when we started electron or when the company started electron 2017 it took them almost a year to launch the second one versus now what we're seeing is they've launched one haste and now they have four or five Hast kind of in the backlog to launch within the next six months or so and so to me you know they went from one to one or two to now being where they have four separate clients for haste and that will probably only continue to grow and they're probably having further conversations that aren't necessarily finalized as of yet right they might be waiting to test um some of those Hast missions later this year and before they they do further s sales or deals right so um I I I definitely think haste is undervalued and it's definitely something to watch over the next year yeah then here's something very um surprising to me um is he was talking about the the gross profit of uh the electron launches and he was basically saying that the Cadence is such an important part of of having a very high gross profit uh that he thinks that once they La once they start launching two a month uh so that is six per quarter uh which is uh what do you call it like 24 uh 24 to 30 launches per year uh the gross profit is going to go up to 45% and reusability would only add a 5% um to to the overall gross margin and and that that's surprising to me that it adds so little because you know you you would think that I I guess it has to do with that this is a small launch vehicle and you know the prices are so uh pressed to begin with like I think Neutron the reusability uh numbers will be should be much much much more than 5% um that's also why I guess they're pushing for reusable uh but so two things that were surprising how little reusability counts for electron and number two is uh the 45% gross margin is very very high and it's a very good number and they're basically almost I mean next year it it looks like we're going to have um we're going to be in that two two launcher month um Cadence hopefully yeah hopefully yeah then um let me see if there's anything here yeah recover recovery takes 40 um kilogram okay so then the very interesting thing is uh what he was talking about in in this interview uh is that once they have uh Neutron up and running they have the keys to space and then basically they they will uh be a completely different company and he he was basically straight out saying that they're trying to build the same business model as SpaceX and he called out and this conference called that there is a huge discrepancy between the price of uh rocket lab and SpaceX which is currently I think 100x uh is uh difference I think it's it's a bit less but he said that the minute they have Neutron the investors have to ask like what is it that SpaceX can do that rocket lab can't and he really got me on that one because it really becomes completely illogical uh to have a 100x difference between the two companies when really you ask the question like once they have Neutron like what can SpaceX do that rocket lab cannot and um I want to hear your thoughts about this statement uh the thing that I don't know enough about um is well I guess I think there's two pieces right there's the interplanetary piece for you know human space travel I think is is probably a piece right now that Neutron could participate in but I think that they're um holding back for now until there's a little bit more of a market for it but I don't know the capability of spacex's Space Systems business Beyond starlink and I'm not devaluing starlink by that statement it's just is starlink a one TR trick pony is SpaceX a one trick pony when it comes to Space Systems and only being able to create starlink which is good to create massive value for them so I'm not trying to downplay that but I don't know if they have the interplanetary satellite capability of putting something to go to Venus putting something to go to Mars putting something to go to and like for example and like I said this is a lack of knowledge right so somebody please correct me in the chat like the psyche mission that was contracted between NASA I know that rocket lab provided the solar piece from their solo solero subsidiary um who made the actual satellite itself right the actual components and things of the like was that NASA was that them Contracting out through somebody else was that SpaceX those are the things that I don't know right now right now what I do know of is rocket laab has a extreme amount of capability when it comes to building specific types of satellites um and whether that's interplanetary whether that's for potential um experiments like with vaarda uh there's a lot of different sort of buses that they've kind of created to to do specific things so to me it's all I guess dependent upon what matters more to you right does Earth matter more to you in terms of being able to provide better Communications better geospatial data Etc or does interplanetary mean more to you which then obviously SpaceX is the one that's really going a little bit more for for that piece but uh but I hear what you're saying right um I also think that there's a large discrepancy between um between the heavy launch piece as well which rock laab hasn't necessarily touched as of yet maybe just because they don't see the potential value in it right now they're really just trying to go after medium launch where they see a lot more value in in the short term yeah I I also just want to react to because there was somebody who like uh tweeted this exact quote from Adam spice when he said it and I saw that like some SpaceX fans was like yeah SpaceX has uh um what do you call it like they already monetizing starlink uh they have Starship uh you know they have the Polaris Mission uh they have all these things uh and and it's true and I'm not saying that the minute we have Neutron we're going to be worth as much as SpaceX but what I'm saying is does it make sense to have a 100x discrepancy between the two companies because yes like somebody also wrote that uh uh what do you call it the Cadence is 200 plus per year for the Falcon 9 yes but we are also increasing Cadence and in a few years we're also going to get to 200 plus um launch per year uh and do you know what happens to the stock price if the difference between SpaceX and Rocket lab just becomes a 10x so we go from 100 to 10x then the stock price 10x is and um I I I really if if you think about what Adam spy said I mean I can't argue with him because it's like yes you know uh you you can you can argue about that SpaceX has the polarities Dawn and they can fly humans but the neutron is human ratable and if if rocket lab is profitable or on the or they're on the way to profitability they can develop easily uh you know that that capability and I I don't even think there's so much I mean the value of SpaceX 70 80% comes from starlink right uh so it it is going to be rocket lab's ability to put a constellation up and monetize it uh and not Starship and and yeah you know the human capsule and and and all these things yeah I think it just depends on what your goals are right right now it's like I think they're looking for that constant Revenue stream uh from a constellation or through haste or through whatever to really get themselves to profitability I think that's currently their biggest biggest goal right now is really come out with a competitor for the Falcon 9 and they get to profitability what happens after that maybe they can have some toy projects but I asked this specifically after the 2q earnings call to Peter himself and he said there's kind of one and a half suppliers for the International Space Station the Market's kind of small so why would you spend $300 million for something that is going to be rather small and not necessarily have a lot of growth potential going forward versus spending $300 million and being able to get something like the neutron or a falcon 9 equivalent rocket that you can launch potentially up to 100 times perom right rather than the two or three times perom that you might need to do for the International Space Station so it just goes to show you you know you have to put your money where where the revenue streams are um and so that's uh that's the thought I mean it's just the same reason why they never started off with a medium launch vehicle right they thought that small launch was going to be the thing and then I guess they realized that the Cadence and the amount of satellites that people wanted to put into space was so great that you could really knock that out with two birds or a couple birds with one stone and so that's when Peter kind of ate his hat literally and then um decided to uh come out with a medium launch vehicle who's to say I mean if SpaceX proves that heavy launches can be affordable sending people from Hong Kong to to rad and and then Hong Kong to to Dubai and people are willing to pay for it and it makes sense maybe they come out with you know a larger vehicle that will be able to do the same right where you can go from Long Beach to New Zealand or to Tokyo or wherever within 45 50 minutes on a medium to small to large launch vehicle um but I think right now rocket laab has kind of a fiveyear delay compared to what I would say maybe even longer I guess to um to what SpaceX has uh you have to think it took it took the Falcon 9 10 years to get to 100 launches total and we're at 50 launches at six years so hopefully by the time we get to 10 years we could be at 120 to 150 launches uh for the electron but I think really a lot of focus is going to be taken off the electron once you get that Medium launch vehicle into to orbit and I think that it's going to be nice is it's kind of going to be old hat at this point for for the electron and there can almost be like a little small Revenue stream associated with that but when you think about it from a how to move the company dial perspective one launch is about the equivalent of you know five or six or actually six or seven electron launches so when you think about it in that respect two Neutron launches will be more than the revenue that all of launch will create within the year of 24 so um in that respect you you kind of think like where should the focus really be going forward for the organization um and you really have to focus on where the money is Right obviously if Neutron wasn't going to make money I don't think rckb would would be doing it they they have aspirations but I think the smart thing is is they have aspirations with efficiency and and um and capital uh discipline in place where I think a lot of companies lack the capital discipline P piece and they focused on growth at all costs and also pounding their chests yeah yeah yeah I think the difference between SpaceX and Rocket lab is like whatever idea SpaceX has they just automatically have the money to try it out right and then if it fails it's like yeah whatever it failed okay next next idea and and Rocket lab would die if they would have this approach and they sort of have to like finish one start making money on it before they go to the next one and it's a slower approach but uh it's I mean they can't do I I mean what do you call it Peter back is the only non-b billionaire or who's who's trying to run a space company here so he has to has to do what how he's doing it okay and the most exciting other thing in this conf conference uh was that Adam spice was actually starting to speak about their infrastructure plans and and what it can be and um I did a video about this on my channel when I was like putting up the you know the Tim foil hat that it might be that actually they get hired to do a constellation so they would uh do a like they would have space in infrastructure that is not let's say like Starling that um you know they develop it and then it it it's up in space and then they go chase the customers but maybe the army or you know some other branch of the government or you know Apple wants to have a service of uh like on the new iPhone we want to have satellite SOS connectivity to all of our devices and um he actually started saying this that because they have the keys to space uh they can manufacture satellites they can uh you know they have the guidance and navigation they have the the satellite communication uh you know all over the planet they can bring a lot of value to uh companies that that would provide satellite service so it sounded like you know uh AT&T could go to them and say that we want to provide uh Satellite Internet to our phones in the US and then they go no problem it's uh you know 30 million a year you pay us and then we we put it up there and then we provide it for you or uh the government or you know apple and this version actually makes me feel like okay because if they do it this way it's very very easy to finance and zero risk because uh you know obviously if Apple would want them to put up a a constellation uh they would have to either pay Upfront for the constellation or it would be a subscription but at that point it would be very easy to finance because you know as long as Rocket lab delivers everybody knows apple is going to uh pay and um yeah so I'm curious if you heard this before or um if if this is the first time you hear it from this Morgan stally um conference then like what do you think about this version of them building out um their own constellation you're muted I think I don't know okay okay I mean for me the main again the main advantages is that if they go this way because I was really worried that um you know they have money and they were always communicating that we have money to put a neutron on the pad and then now they did a uh Capital raise to acquire new companies and I was always very very worried that they're going to need significant amounts of money to build their own space infrastructure and as we can see from ests and you know many other constellations uh like these can be in the billions of dollars and for them to raise capital for billions of dollars when the stock price is in the fours is uh not so sexy you know so uh for me it was like a huge relief that this option is on the table heard it here first all right all right cool so I think that was all the rocket Lab news for this week now we have General the segment about General space industry uh the blue origin uh inaugural flight for the new Glenn is coming up and and uh it looks like they're going to try to land uh blue origin on on the first try like they think that there's a chance that they can do it um I saw everyday astronauts tour of the factories and Jeff Bas was explaining the engineering that goes into these rockets and uh I really changed my mind about blue origin I think they're quite a serious competitor way better than than I thought they were before and because they have been Landing the new Shepherds before it's also not like the first time they are ever going to land the rocket so I think that there is a chance that they it might be successful what what do you think yeah I never thought uh blue origin was a complete garbage company I think May some people give them grief because they don't necessarily go too much into space itself um and you know they really just kind of travel up a little bit just touch kind of the the place where you can kind of call yourself an astronaut and then kind of come right back down and land they don't really you know I what's the word I'm looking for they don't really go into orbit let's say um or at least from what I've seen they haven't really done too much with with orbital stuff I could be completely wrong in that though um so I really think new gland was going to be the the thing that really sets them aside from where people just kind of assume they're space tourism s of sort of company and actually make them uh a company that's kind of serious in terms of actually getting things ready for the emis program that's going to be coming up as well as going to Mars so um yeah cool cool cool cool okay so next news is um that this week we had the first uh private space walk uh by the hilarious Dawn Mission SpaceX uh Dragon capsule uh as far as I understood it went really well what I've seen in the videos is that they like opened up the hatch and then they like half went out of the of the capsule and then they were testing the mobility of the clothes and it looked quite funny they were like uh they looked like they were getting a stroke up there um I thought that they would like come out and you know like go around the the spacecraft or something uh maybe that's still in the plans I I don't know um okay so what yeah what what do you think about this news you know I was um kind of underwhelmed like you stated I mean I was expecting them to be like out on tethers and you know flying around in space and like swimming and but um it makes sense I mean I think it's the first first attempt at at this first time a private company has accomplished something like this and so I think they were doing a lot of calibration capturing a lot of data I heard them kind of saying like look left look right look up look down and and I think they were really trying to just calibrate get a lot of data before they go back a second time or a third or or for the future and really get I guess the the real dangers which is out people out on tethers and and things of the like so um I umum yeah I'm fairly confident that they will will be going out in the future but like you said I was maybe when I heard Space Walk I was uh thinking a little bit more yeah me too oh I would have nightmares about this tedar like can you imagine if the like the tedar like breaks or you like forget to clip it in or something and then you just drift away from the Dragon capsule that's like that's it I may maybe maybe SpaceX could like reprogram something and then the capsule could like pick you up but uh yeah I I would have nightmares on the te on the tedar but uh yeah I don't have the money and I don't think I would have the the courage to go on a space fight how about you Matt I don't think I could pass the exams uh would you you um I don't know I have to think about it I get anxiety going on uh airplanes a little bit so um I I get over it once I'm on the plane but like the it's more so getting there making sure I don't miss the flight you know stuff like that but once time I get on the plane I'm generally okay um so I don't know I don't know yeah yeah yeah Gregory is asking what impact does space debris have on Space walks uh my understanding is that if you get hit by space debris you're you're dead on the spot so it's um it's it's a constant risk uh when you're out there they they were 700 kilometers high up from Earth and I think that there is basically zero space debris um but anything that is traveling with you is traveling at 26,000 kilm an hour or something like that uh which is something like 15,000 miles per hour if you're in the us system uh which is 10 times the speed of a bullet so even if you have like um like a like a paint from a rocket that was chipped off and it hits you at that speed it's like I mean it just goes straight through you and and the and the what do you call it and the what is it called the space suit that that you're wearing um so that that that is my understanding I don't know if you know more uh also anticipate that a lot of the area that they're doing of the walking is very far outside of orbit um and so I think you know I could be wrong on this piece but you could kind of see a little bit more the curvature of the earth versus I think where a lot of the things that are traveling around the Earth are a little bit closer uh and so with that I think you're not necessarily there is still a debris of course right I mean there's always things traveling in space it's space for God's sakes but I think the the concentration of space junk is a lot closer to the Earth's orbit than where they were doing a lot of their tests but I I have a very rudimentary knowledge of any of this so I could be completely wrong yeah the same same here I think Dave Huntsman who is in the chat I I think he maybe it's just his profile picture but he seems to be like from his comments I understand he knows a lot more about engineering and space than us um yeah and and by the way this was a a record um that there was 19 people up in orbit which just shows you how freaking early we are in the space age because like 19 people is is a highest ever and a record uh in in space together and to me the number is insanely small I mean Elon wants to fly 100 humans per Starship to Mars and uh he wants to fly like hundreds of Starships at the same time um so yeah we are very very early all right now the last news of the week um is as as space mobile has launched their satellites to be able to begin delivering service um the stock price crashed on on the launch news so welcome to the club as s uh but yesterday had a pretty good day and was up 13% um what do you think is this stock a buy is it something you have your eyes on um yeah sorry what was the question like do do you think that this stock is a buy do you have your eyes on this stock uh and what do you think is going to happen with ASDS space mobile now I um you know I along the thoughts of expanding my space Holdings and to be honest um it's not that I don't think that there's other going to be there's going to be other successful companies out there I think that there's going to be plenty I just my thought process was is rocket lab is positioned to be a leader in a lot of that space already it's going to have secure cash flows coming from it it's already going to be a position where I'm going to get a 10x so why dilute my concentration in rocket lab or or dilute my diligence in in rocket lab by investing in a second company that would distract me away when I'm very confident that rocket lab will continue to outpace likely a lot of the other companies out there um so I mean I I already had plenty of positions in the 2021 time frame like I was in momentus I was in Virgin Galactic uh I was in a few other positions and I've trimmed those down to to be specifically in rocket lab so while ests I think is going to do a good job I I don't think that their current market cap reflects where they are in the company and I think you know there'll be a a spot where they're continuing to grow from a actual Revenue perspective and the the drop in the stock price will eventually meet that to be something that is a little bit more um favorable at the current moment for some reason I would anticipate that the current stock price or market cap of ests is probably on the order of uh I would say four to five times what rocket laab is right now and I think rocket laab is much further along in terms of its overall uh agenda and ability to generate revenue and and returns for shareholders than ests but I could be wrong in that right it could grow a little bit faster and um that I'm giving credit for but I also think that the meta constellation if I believe what rock laab is saying is going to be a huge piece of of what they're deploying for the market and who's to say that whatever rocket lab comes up with uh in terms of the ability to launch a a constellation isn't going to eat away at what ests is doing um and it's not to say it's going to be directly verbatim right but there's a lot of ways to skin a cat so um I just want to congratulate everybody that invested in it I just think that right now it wouldn't necessarily be a bad thing to potentially take some of your profits um but then again it also depends on where you think the long-term trajectory of the stock is I don't know enough about where they're going what what they're what they're trying to do at assts to say it's worthwhile taking a a profit right now like they could be trying to grow to a $200 billion doll a year organization in that case you know the the 15 billion 20 billion dollar market cap is is too small yeah yeah I agree with you and I think that the reason why ASDS stock price is so much ahead of Rocket lab is because uh like rocket lab is building out the capability to create a space infrastructure and the space infrastructure they're not giving us any data on which means that uh the Wall Street analyst cannot put put it into an Excel table and cannot give any value to it uh so I think that rocket lab is being valued on Purely being a space systems and and Rocket company and they're not really giving guidance on their space systems that they're not making it easy for analysts let's put it this way whereas ests they have currently zero Revenue but they have a very clear outline uh outlined space infrastructure with um you know very easily forecastable uh market and and this is what the analysts think like I we have to to see if those projections come come true uh but I think that that's what's giving them this insane price increase is that it's very easy currently to forecast it and I think buying at this level I I did a calculation that if the if the analyst projections are true then in 2027 or something like this maybe 2028 I did a video about it if you guys want to watch uh the stock should be like 67 $64 or something like this uh but the problem is that they have to execute perfectly right and I think that this moment now that the satellites are up in space is really where the rubber meets the road now uh and we are going to see if if analysts were correct in their projections and if they miss in any way um or or it takes them a few quarters more to you know scale up to the customers that they want I think the stock price is going to collapse and it's not my risk profile to to uh own this stock I'm very happy with rocket lab yeah I think it'll it'll continue to do really well cool I think that was all the news for this week I just wanted to show this graph um so that we technically also look at where rocket lab stock price is and you see how cheap I am I don't pay for trading view sorry that's why the ads keep coming up so we have had this channel since 2022 uh April we have been oscillating between you know almost $8 down to $3.5 and we have been in this zone so uh technically there should be like if we go past this level uh we will go much higher to some other unknown level there's also a chance that we uh stay like if this becomes a resistance then you know we we will get a poolback and stay below this price uh just for a fun fact we did our first interview with Peter backck and Adam spice somewhere here uh we did the second interview I don't know somewhere here but I'm I'm not saying but just just it it seems to be like a good working strategy to speak with retail investors what yeah I'm not smart enough to do technical analysis in fact Dave Huntsman would say I'm not smart enough at all so um I just I generally just try to rely on what I think is a decent um movement with inside the organization and that they're achieving the right things that they say that they're going to set out to do and I think the stock price will eventually follow um I just look at the fact that there's a a $200 billion $210 billion do valued company out there that's doing really good things and um has done a tremendous job over the past 24 months and has been doing a good good work since 2003 and then you have Rocka lab that's you know a couple years behind it and is really trying to emulate a lot of that and with that I think there's going to be four or five key you know stakeholders within this massive thing that we call the space race from an American side and with that I think it's it's going to be a good opportunity um to me I wish I had an opportunity to buy a little bit more shares but um I had plenty of time right I mean just look at how long it was down and unfortunately I was uh really I guess not necessarily concentrating on doubling or tripling down my entirety of my position so um yeah I'm I'm excited wherever it goes whether it comes back down whether goes up it's going to be fun regardless yeah yeah I mean I would not be surprised if we get a a pullback here or we we rest a little bit here because um I I I think the biggest Catalyst now for the stock is uh a new government contract uh being announced I think that Q3 is going to be a little bit disappointing when it comes to uh launch and and they did guide down like uh in the revenue like quarter on on quarter like compared to Q2 it's still a major increase um compared to last year Q3 um but or unless because that that's been really the hard thing for me lately is that it it feels like the last three weeks like the stock price is basically connected to ests and wherever ests is going like that's where also we're we're going um so if you came here and you thought that you would get help with the stock price then you're in the wrong place we don't know where the stock is going to go um and and yeah the best thing I could say is have have your price and uh when you go below when the stock price if there is a pullback and it goes below level then you know when you need to start only fans to pay for uh the new stocks that you need to buy and and uh yeah you're you you should know when you when it's too high for you to stop adding to your position but um I don't know if you have any smart advice for the people who are looking at this no I um i' just like to buy stocks man I I don't know I'm a I I use the longtime Horizon as a scapegoat so if the stock price is down I can be like well my time Horizon is long right um yeah yeah so that's uh that's pretty much it but no I like to look for companies that are in the brink of being profitable and um you know I'm trying to find another opportunity after this one goes profitable all my other companies um have already kind of gotten there right like Sofi I was like oh let me get a little bit of Sofi because that just went profitable this is one that's just about to get to profitability within the next 24 months so I'm looking out for the next tranch of of potential companies um that will kind of have a mind of Their Own but I think the thing that'll be really telling is when what this what the price does when we get a full Neutron launch I think that'll be fun once we get some more haste under our belt but I think it's really going to be driven by Revenue growth over the long term and and net income and you know it'll have a place of irrational exuberance I think between now and and that place but once you hit profitability I anticipate the stock price will probably come down a little bit because people then will be trying trying to Value it based off of what the price to earnings is and and things of the like and so unless you keep that Innovation alive of hey yeah we're we're focusing on profitability we had some little bit of profitability but we're also still growing at a rapid pace and we're coming up new revenue streams and you know things that are new that will add on to kind of hide the fact that you're only generating let's say $100 million in cash or $200 million in cash on an annual basis then that's uh I wouldn't be surprised if you see a large come up in terms of price when we get Neutron on and then a slight settling down uh but like you said that's heay and I literally have no idea right it all just depends on what the Market's feeling at the time yeah yeah one last question before you go so you were in Mexico uh with Tevis as far as I understand and last time you were saying how Tavis made you buy Sofi and I was complaining that you didn't get him to buy Ro ET lab and did you manage to break through this this time round and make him buy rocket lab hey man sometimes you can lead a horse to water any of times and unfortunately you can't get him to drink right so uh unfortunately no and it's to his detriment you know um I'm not saying that you know he's he's stupid or anything in the like sometimes you just have your stocks and sometimes you could literally put it in front of plenty of people's face I put it in front of Steven furillo's face I put it in front of AIT I put it in front of many people's faces and you know they just they they don't see the flashiness I guess they don't see the Allure they want to think that it's rocket mortgage or something they they don't want to believe that there's actually Rockets going up into space right they don't want to take that chance and I get it right it's it's a historically unprofitable space this company along with the SpaceX has done probably the best job that I've seen and getting it to go where they need to go and um at the end of the day we'll we'll see I guarantee once it hits profitability though you're going to see a lot of these people join on yeah yeah it's so funny I was speaking to my uncle and he said like a rocket lab is a company they're like this just hopes and dreams you know he said tell tell me when they're profitable and I'm like yeah but they will be like $30 when they're profitable and he's like yeah but that's a good point to buy I'm like okay I thought the good point to buy was $4 dollar but fine I'll let you know it's different risk tolerances for some people right uh I mean there's there's going to be some skin on the bone and some people just like the swing trade stocks right companies that are slightly overvalued they're trading at a price earnings of 10 they ride it to the price earnings of 15 and they sell it you know and some people do a good good business doing that but a lot of people the problem is they don't know what they don't know right just like me there's a lot of in the stock market that I don't know um and you know I'm I'm oblivious to things like day trading and being able to measure gamma squeezes and like that when it comes to options and I don't know if I'll ever know those things because I don't really necessarily care but you have to find what works well for you I'm up 50% on the stock I'm excited about it it's um my second largest individual stock holding and I think it's going to outpace the first one uh by a large margin in the next five to 10 years not to say paler is a bad company but they're a little bit overvalued right now and also I don't really forese paler 5 Xing from here in the next five to 10 years right it'll it'll get there eventually right but uh I just don't see it going to be a uh because it's an 80 billion dollar stock now I don't see it going to 400 billion within the next five years right um I mean we 4X in two years or something like that cannot that cannot continue yeah so um so yeah I mean versus Rocket lab you're coming at a much larger sorry much lower cost basis so um in terms of market cap I mean right uh so you can potentially get on board a little earlier yeah awesome cool well thank you guys as always uh for for watching I hope you guys enjoyed this episode please make sure that you subscribe to both my channel and Matt's channel uh everything is in the description box below uh I just want to give one last shout out to Fool's Gold who I think became a millionaire he was a millionaire already but his rocket lab position is over a million now he has an insane amount of shares so shout out to him and I think soon many of us will follow when the price goes higher maybe didn't want people to know that but hopefully you wanted people to know he put it in the comments so I I okay hopefully hopefully hope and in the in the chat box over here or yeah yeah yeah yeah okay okay okay okay it's a different I didn't see that okay per it's one thing if people are like dming but like another thing if like people yeah yeah you're good you're good I I wouldn't disclose that but he he wrote it here so I thought it was public public enough cool cool cool yeah yeah you see it yeah my bad my bad awesome guys see you guys next week Chia Chow yeah Che cheers