Space Investors Take Note: Rocket Lab or SpaceX Before 2026 Runs Out

Investors were so excited to own a piece of Space Exploration Technologies Corporation (NASDAQ: SPCX), better known as SpaceX, that it instantly became one of the top-10 biggest companies in the world by market cap. Its June 12 initial public offering (IPO) was highly anticipated, elevating the stock price of other businesses in the emerging space-based economy.

For example, shares of space-services company Rocket Lab (NASDAQ: RKLB) soared to a multiyear high of $151 on May 27. However, both SpaceX and Rocket Lab stock have fallen since the former went public. This presents a potential buy opportunity.

But if you had to pick one of these space-faring enterprises, which is the better investment in 2026? Here's a deeper look at the two businesses to arrive at an answer.

Image source: Getty Images.

Unpacking SpaceX as an investment

After investor enthusiasm for SpaceX's public debut faded, the company's shares began to tumble, falling below the IPO price of $135 per share. When you dig deeper into the business, the drop is understandable.

SpaceX produced $18.7 billion in 2025, representing 33% year-over-year growth. Its Starlink satellite-based internet service comprised $11.4 billion of that sum, an outstanding 50% increase over 2024. Those are impressive numbers.

That said, the company spent $20.7 billion in capital expenditures last year, nearly double the total from 2024. While launching rockets and satellites into orbit isn't cheap, the bulk of that spending went toward artificial intelligence (AI) infrastructure. The AI part of SpaceX's business produced $3.2 billion in 2025.

The company justifies its AI spending by highlighting the $26.5 trillion market opportunity. That's magnitudes bigger than the $370 billion market for the space-based capabilities it became known for. Even so, SpaceX's AI competes against the likes of Microsoft, Google parent Alphabet, and now Meta, which recently announced it's providing AI solutions to others. (NASDAQ: MSFT) (NASDAQ: GOOG) (NASDAQ: GOOGL) (NASDAQ: META)

SpaceX made a name for itself as a premier rocket-launch company, but it hasn't proven it can achieve a return on its AI investment. Consequently, its elevated valuation, as demonstrated by a price-to-sales ratio of 77, may not be justified, resulting in a steady share price decline since the IPO.

A look at Rocket Lab

Rocket Lab offers comprehensive launch and space-systems services to commercial and government customers. The strength of its offerings was demonstrated when it became the first to execute an end-to-end space mission for the U.S. Space Force (USSF) this summer without involving other contractors.

The company designed, built, and launched a spacecraft within 16 hours, demonstrating its ability to respond quickly to a national security threat. Consequently, it was awarded a $266 million contract with the USSF in July. That's a significant sum for Rocket Lab, given it generated $601.8 million in 2025.

The space specialist kicked off 2026 with a strong start, delivering record first-quarter revenue of $200.3 million, a jaw-dropping 63.5% year-over-year increase. It's poised for long-term growth, as its backlog of orders totaled $2.2 billion at the end of Q1.

Is SpaceX or Rocket Lab the better buy in 2026?

Before deciding which space stock is a superior investment, consider a few key factors. Neither SpaceX nor Rocket Lab is profitable. In Q1, SpaceX reported an operating loss of $1.9 billion compared with operating income of $27 million in 2025. That significant swing in one year is due to the costs associated with its AI investments.

Rocket Lab posted a Q1 operating loss of $56 million, down from $59.2 million in 2025. This reduction is encouraging, and if the trend holds, Rocket Lab can reach profitability before SpaceX.

From a valuation perspective, both companies' share prices are high. Yet compared to SpaceX's sales multiple of 77, Rocket Lab's 55 makes it a better value. The risk that you may be overpaying is elevated for SpaceX because pre-IPO investors will be eligible to sell their stock in August, potentially flooding the market with billions of shares.

One other consideration is that SpaceX CEO Elon Musk controls over 80% of the voting power. Investors have little say in how the company is run. Rocket Lab operates under a more typical framework where voting power is proportional to equity ownership.

After examining SpaceX in more detail, it's clear that buying shares now holds many risks. Meanwhile, Rocket Lab is growing sales and reducing losses, and its technological accomplishments point to potential for further share-price upside in the years ahead. These factors make Rocket Lab the better investment to gain exposure to the burgeoning space sector in 2026.

Robert Izquierdo has positions in Alphabet, Meta Platforms, and Microsoft. The Motley Fool has positions in and recommends Alphabet, Meta Platforms, Microsoft, and Rocket Lab. The Motley Fool has a disclosure policy.