Space stocks are having a moment. And not the fleeting, meme-stock kind. We're talking about a fundamental shift that analysts at Wedbush are calling the best buying opportunity 'in a generation.'
On Wednesday, the firm initiated coverage on a handful of space players, including SpaceX—yes, the private rocket company that's been eating NASA's lunch—and a few publicly traded names that have been beaten down but are poised for a comeback.
Let's cut through the hype: this isn't about Elon Musk tweeting memes. This is about cold, hard cash flowing into defense budgets, satellite internet, and launch services. The geopolitical landscape is a mess, and governments are throwing money at space like it's the new nuclear deterrent.
Why Now? The Perfect Storm
Three things are converging. First, the war in Ukraine has spooked every defense ministry in the West. They're all scrambling to upgrade their satellite capabilities and missile defense. Second, the cost of launching payloads has dropped by 90% in the last decade thanks to reusable rockets. Third, the commercial space economy—think Starlink, Earth observation, space tourism—is actually generating revenue now, not just promises.
Wedbush analyst Dan Ives put it bluntly: 'We believe we are at a generational inflection point for the space and defense ecosystem.' He's not wrong. The numbers back him up. Global space spending is projected to hit $1 trillion by 2040, according to Morgan Stanley. That's not pocket change.
The Stocks to Watch
SpaceX is the crown jewel, but it's private. Unless you're an accredited investor with deep pockets, you're not getting in directly. But there are ETFs and publicly traded companies that track the sector. The ARK Space Exploration ETF (ARKX) is one way to get broad exposure. It holds names like Iridium (IRDM), Trimble (TRMB), and Maxar Technologies (MAXR).
Then there's Virgin Galactic (SPCE)—the volatile one. It's more of a moonshot, but if space tourism takes off, it could 10x. Or go to zero. That's the gamble.
Lockheed Martin (LMT) and Northrop Grumman (NOC) are the boring, reliable defense plays. They're not pure space, but they get a huge chunk of revenue from satellite and missile contracts. If you want sleep-well-at-night stocks, these are it.
'We believe we are at a generational inflection point for the space and defense ecosystem.' – Dan Ives, Wedbush
The Risks Nobody's Talking About
Let's be real: space is risky. Rockets explode. Satellites get hit by space junk. Governments change priorities. And valuations are already pricing in a lot of optimism. SpaceX's last private funding round valued it at $150 billion. That's more than Boeing. For a company that hasn't turned a consistent profit?
But here's the thing: the bull case doesn't depend on SpaceX becoming profitable tomorrow. It depends on the long-term shift of economic activity into orbit. Internet access for the unconnected, climate monitoring, GPS, national security—these aren't optional. They're necessities.
The biggest risk is timing. If a recession hits, defense budgets might get squeezed. But historically, defense spending is one of the last things governments cut. And space, in particular, is seen as a strategic asset. So the downside might be limited.
How to Play It
If you're a conservative investor, buy Lockheed or Northrop. They pay dividends and have decades of backlog. If you're more aggressive, look at the ARK ETF or individual names like Iridium, which has a unique satellite network that's hard to replicate.
For the true risk-takers, SpaceX is available through secondary markets or funds that offer access. Just be prepared for volatility. And don't bet the farm.
The bottom line: space is no longer science fiction. It's a real, growing industry with serious tailwinds. The analysts at Wedbush are right—this might be the best entry point in a generation. But like any investment, do your own homework. Don't just buy because Elon tweeted a rocket emoji.
Now go make some money. Or at least don't miss the boat.
