Rocket Lab shares tumble 24% after Neutron tank rupture and Mars funding cut
Rocket Lab shares plunged nearly 24% from January highs after a Stage 1 tank ruptured during Neutron qualification testing at its Long Beach facility, triggering investor concerns about launch delays. Further pressure followed Congress declining funding for a 2031 Mars sample-return mission, intensifying doubts over long-term government contracts.
1. Stage 1 Tank Rupture and Stock Reaction
In January, a Stage 1 liquid oxygen tank ruptured during qualification testing for the Neutron rocket at Rocket Lab’s Long Beach facility. The failure, while not damaging nearby infrastructure, spooked investors and prompted a nearly 10% drop in shares that extended to a 24% decline from their January record highs.
2. Mars Mission Funding Cut Impact
Shortly after the testing incident, Congress declined to fund the planned 2031 Mars sample-return mission, raising questions about Rocket Lab’s visibility into future government contracts. The funding setback added to negative sentiment, as the company had been targeting NASA partnerships to bolster its long-term revenue pipeline.
3. Technical Support Levels
Despite the drop, the stock has found support near its rising 50-day moving average in the low-to-mid $70 range and remains well above its 200-day average. This price action suggests the primary uptrend may still be intact, with a retest of the 50-day average viewed as a potential buying opportunity.
4. Analyst Ratings and Outlook
Analysts maintain a Moderate Buy consensus with price targets that have climbed from about $57 three months ago to nearly $73 in early February. Market watchers will focus on Rocket Lab’s upcoming earnings call for updated Neutron launch timelines, vertical integration progress and margin trends.