2 Space Stocks Down More Than 50% That Could Be the Best Buys of Q4

Rocket Lab reported record Q2 2026 revenue of about $234 million, up 62% year over year, and a record $2.4 billion backlog, up 137%; its Neutron medium-lift rocket’s inaugural launch has been delayed to 2027. AST SpaceMobile is targeting initial intermittent coverage in the U.S., Canada, Japan, the U.K. and Saudi Arabia before year-end 2026, with partnerships spanning more than 60 mobile operators and over 3 billion subscribers; its shares have fallen roughly 69% from their May peak and it trades at 98 times sales. Both companies face execution and funding risks, while Rocket Lab’s announced Iridium acquisition remains subject to completion.

Analysis

The key distinction is evidence quality: ASTS has a commercialization milestone, while Rocket Lab has operating revenue and a backlog that still must convert into revenue and cash. ASTS’s operator relationships may lower customer-acquisition friction, but do not by themselves establish service availability, handset compatibility, capacity, usage, or attractive revenue sharing. Initial intermittent coverage could validate engineering yet disappoint investors expecting a scalable service; at the stated 98x sales, even a technically successful launch may not support the valuation without credible monetization and funding visibility. AT&T and Verizon may gain a differentiated coverage feature, but material economics for them are unproven.

RKLB’s backlog offers better near-term evidence than ASTS’s pre-commercial opportunity, but backlog is not cash flow: monitor conversion, cancellation/timing risk, development spending, and Neutron schedule credibility. The proposed Iridium transaction adds a second execution and financing variable. Without disclosed consideration and financing terms, IRDM’s implications are event-driven; do not assume the deal is accretive to RKLB or that it removes standalone IRDM risks.

Over the next days, positioning may remain sentiment- and launch-headline-sensitive. The Nov. 9 earnings event is the nearer RKLB catalyst; over 6–18 months, ASTS needs repeatable service economics and both companies need execution. Contrarian view: the drawdowns do not automatically make either stock cheap—especially at the cited sales multiples—but operational proof could matter more than the recent price decline.

Key Decisions for Investors

• Prefer a small, staged RKLB position to ASTS for exposure to the theme, with initial entry only if the Nov. 9 update does not worsen the Neutron timetable or reveal weakening backlog conversion/cash economics. Reassess after the release; reduce on another schedule slip or evidence that backlog is not converting.
• Do not chase ASTS ahead of intermittent coverage. Revisit after independently verifiable service tests and disclosure on coverage, capacity, handset compatibility, operator economics, and funding needs; failure to demonstrate usable service or a material funding deterioration would falsify the deployment thesis.
• Treat an RKLB–ASTS pair as a possible relative-value expression, not a low-risk hedge: ASTS’s high valuation and pre-commercial status support underweighting it versus RKLB, but short-squeeze and beta risks are substantial. Avoid sizing until borrow, volatility, and relative beta are checked.
• Keep IRDM on transaction watch rather than making a directional call: verify the announced deal’s consideration, financing, closing conditions, and timing. Those terms determine whether IRDM trades on deal value and whether RKLB assumes meaningful balance-sheet or integration risk.