RKLB delayed Neutron to 2027 and fell 10%, but it is not a buying opportunity: at $53 it trades at 23.5 times forward sales versus his ~$22 fair value, so risk-reward is unappealing and risk too high for the upside. The delay is not existential given $2.3 billion cash, but he awaits a better entry.

Today we received some unfortunate news for Rocket Lab stock investors as the company has postponed the launch of its Neutron rocket once again to 2027.

Remember that this Neutron rocket launch has been postponed several times before, and today's postponement caused the stock price to drop by as much as 14% before it recovered.

It is now trading down by approximately 10% at the time of recording this video.

Of course, I have been warning investors for months and years now about Rocket Lab as an overvalued stock, not because of this news specifically, but because it is generally overvalued, especially earlier this year when there was a euphoria over space stocks as a result of SpaceX’s IPO.

But does this recent decline finally make Rocket Lab stock a buying opportunity?

So, the space company has postponed the first launch of its Neutron rocket, its medium-payload reusable rocket, to 2027. They had been targeting the fourth quarter of 2026 for the debut, but CEO Peter Beck attributed this latest delay to manufacturing problems with the forward fuel dome in the rocket's first stage.

He added that this does not necessarily mean the dome will fail in flight, but they want to be cautious and postpone until they are sure there is a sufficient safety margin for a successful launch, rather than rushing the launch just because it was their planned objective.

So, this is their competition against SpaceX's Falcon 9 rocket, and this launch was previously scheduled but delayed. They unveiled the rocket in 2021 and 2024 was the initial target year for the flight, then they moved it to mid-2025, and then to 2026.

The first-stage tank ruptured during testing in January.

Therefore, there have been several delays and setbacks to the company's target launch date, and you can forgive the company for these difficulties. This is literally rocket science. It's not easy.

Therefore, the research and development efforts needed to develop this type of technology are highly uncertain, so timelines are merely targets. These are goals. Investors should not consider them as guaranteed or certain to happen.

Therefore, Rocket Lab's stock fell after today's decline of more than 23% since the beginning of the year. It is down by about two-thirds, or 66%, from those moments of euphoria during SpaceX's IPO when Rocket Lab's stock soared to $150.

As I have done before, I have warned investors many times against getting carried away by that euphoria. I've seen this before. I will quote from the TV series "The Squid Game," specifically the main character in the second season when he says: "I've played these games before." In other words, we've been through this before.

Those moments of euphoria, enthusiasm, hope, and excitement that drive company stocks to astronomical levels do not usually end well for investors who buy at those peaks. You can look at the recent space stock frenzy, and before that the quantum computing stock frenzy, and before that the meme stock frenzy, and before that the non-fungible tokens (NFTs), and we can go on through history observing moments of excessive enthusiasm from investors that drove stocks to unrealistically high levels, and then crashed, causing investors huge losses because they were swept along by those moments.

So, I hope you were watching my videos during those moments, and avoided buying Rocket Lab stock at those record levels.

Overall, this is one of the most innovative companies in the world, and its balance sheet is in excellent condition. They have over $2.3 billion in cash and short-term investments.

They have been expanding through acquisitions recently. They are waiting for an acquisition deal to be finalized, but they have enough liquidity to support them until they reach the next milestone.

Therefore, the delay in launching "Neutron" is not an indication of the end of the company. It's just a delay. This is how we should look at it. The project has been postponed before.

It is a technology that is difficult to control. It might take a little longer. The launch may be delayed again, but the company has sufficient liquidity in its budget to withstand further delays.

It is very likely that you will be able to reach the next milestone. Not 100%, but she probably has enough capital to reach that milestone.

So, the stock is now trading at a forward price-to-sales multiple of 23.5, which is roughly the valuation it was trading at going into 2026. I calculated the fair value of the company at around $22 per share, and even after today's drop to $53, the price still looks very expensive.

This is one of those high-risk, high-reward opportunities, and I am not against entering into such opportunities. I have several of these companies flagged as buying opportunities, but I'm waiting for the right moment.

As for Rocket Lab, I don't think its price is attractive enough for investors to take the risk, because the risk-to-reward ratio is still not appealing; you are taking too much risk with this stock.

It is one of the most dangerous stocks in the market. Therefore, you must ensure that there is sufficient upside potential to compensate you for the risk you are taking.

As I mentioned previously in the last update on September 2, I don't think this is a buying opportunity. If you were interested in buying this stock, you would have waited for a better entry price before doing so.