Im gonna through out just a think piece, as I like to be on the pessimistic side of hype. If space stocks where going to grow at the "projected" rates in some cases people are saying 5x to 10x from where we are, how come these companies are issuing shares like they are stock salesmen and not space companies.... the argument I would like to make it that these companies are not "bad" but that as investments the companies will dilute returns for growth and that the investors will not get to appreciate the boom as they could have. most of these companies have been issuing shares at about 5% per year. for a growing company that is resonable, this year alone 15% issuance and growing, why? take advantage of investors capital, not provide investor returns. you are free to fight me in the comments, here are the macrotrends(website) charts for the companies $RKLB$ASTS$MDA$LUNR$PL blossom is hyping up these stocks, im just hear to remind you that growth in companies doesn't always equal growth in returns. p.s. mda is an exception they havent exploded in shares but it has been increasing steadly
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Nick @realnickstrategy · 1mo
Just perhaps this is a rapidly growing industry that needs large sums of capital in order to make strategic investments now in order to better position these companies for the long-term😉
Rez @rezola · 1mo
It's a case by case thing. Share dilution isn't inherently good or bad so depends on how the capital is used. In the case of $RKLB the funds raised are being invested in scaling manufacturing developing Neutron etc. That's very different from companies like $AMC which used it during COVID pay down debt. The purpose behind the dilution matters just as much as the dilution itself.
Anthony Holstein@anthony.invests · 1moEdited
That’s the way these companies do to grow because it’s a super cash intensive industry $LUNR has been diluting shares to acquire companies, but these acquisitions allowed them to hit positive EBITDA and 5x their annual revenue Acquiring multiple companies also allowed $RKLB to grow their revenue and diversify their products, not going all in on a product like certain space stocks and go bankrupt if that single product doesn’t work. Through acquisitions they were able to become 100% vertically integrated (not be reliant on suppliers) and become one of the rare end-to-end space companies. $RKLB make reaction wheels in Toronto, solar panels in the U.S., lasers in Germany, etc. And they have acquired a profitable business recently ($IRDM) As long as management use the money wisely, I’m okay with my shares being diluted (always happy to see my $RKLB shares diluted because the CEO is a goat) $SPCE is diluting to just be able to operate, not even to fund their projects or acquisitions, which is very different than $RKLB or $LUNR
