For six straight quarters, from the beginning of 2024 all the way through mid-2025, Boeing (NYSE: BA) stock couldn't catch a break. Production volumes were crippled in the wake of the Alaska Airlines door blowout, airplanes piled up, losses mounted, and free cash flow dried up. Every single quarter, Boeing lost money and burned cash -- $12.4 billion in total GAAP losses, and $16.8 billion in negative free cash flow.

But then, a miracle happened.

By mid-2025, Boeing had mostly righted the ship, stabilized its supply chain, and resolved its quality-control issues. Q2 2025 saw Boeing deliver more airplanes in a single quarter than it had ever done since 2018. Revenue rose, losses shrank, and by Q3 2025, free cash flow had turned positive again. While GAAP profitability has remained elusive since, in three of the past four quarters, the aerospace giant has generated positive free cash flow -- $631 million generated last quarter alone -- laying the groundwork for a return to consistent profitability in the future.

Now Boeing just needs to stick the landing.

Image source: Getty Images.

Boeing has a plan

After the Alaska Airlines debacle, the U.S. Federal Aviation Administration ordered Boeing to slow down production and ensure each plane was shipshape before delivery. Boeing was initially instructed to take its time and build no more than 38 of its 737 airliners per month, a limit later raised to 42 planes. The company is currently seeking permission to accelerate that rate to 47 planes per month, with plans to increase it to 52, and eventually 63, planes per month.

More planes produced should translate into more planes delivered -- and more cash collected on delivery. Analysts polled by S&P Global Market Intelligence forecast Boeing to generate more than $2.3 billion in free cash flow this year, growing to $6.2 billion in 2027, $9.8 billion in 2028, $13 billion in 2029, and $15 billion in 2030.

Yes, you read that right. Boeing's probably going to return to full-year positive FCF this year, grow that dramatically over the next five years, and even then still be growing free cash flow at a healthy 15% per year.

Assuming all goes as planned, Boeing is trading today at just 11 times its projected FCF five years from now.

What needs to happen next

What does Boeing need to do to make this happen? The good news here is that the issues that upset Boeing's apple cart last time around -- botched introduction of new products -- aren't likely to arise over the next five years, because Boeing doesn't plan to introduce any completely new "clean sheet" models during this period.

New variants of the 737 are undergoing flight tests and certification, however, as is a larger 777-9 airliner, and those have the potential to cause problems. But so long as Boeing keeps a tight focus on quality control, it should have a smooth flight from barely positive free cash flow today to massively profitable $15 billion annual FCF in 2030.

Key to this effort will be taking control over the company's Spirit Aerosystems subsidiary, its supplier of 737 fuselages -- and the company responsible for building the specific 737 that blew out over Oregon in 2024 -- and also turning that business profitable. As The Wall Street Journal reported last week, Boeing's $4.7 billion repurchase of Spirit last year actually cost Boeing closer to $10.3 billion once debt and obligations to perform "money pit" contracts are factored in.

This obstacle isn't insurmountable for a company that may soon make $15 billion a year in cash profit. More importantly, fixing Spirit's quality issues is key to Boeing being allowed to increase production to reach that $15 billion goal -- but it will be a near-term drag on financial results.

What else Boeing needs to do

And Boeing's to-do list doesn't end there; it doesn't end with the Commercial business.

As I pointed out last month, Boeing's defense business is once again profitable, and recently booked a major $131.2 billion contract to upgrade global F-15 fighter jet fleets. Once a headwind for Boeing, the defense business could now become a second tailwind as positive profit margins begin to turn a growing revenue stream into a second source of profit.

For this to play out perfectly, Boeing needs to avoid the temptation to underbid competitors to win big Pentagon projects, such as the 2011 KC-X Tanker project, which is still racking up losses to this day. Boeing should also probably abandon its ill-fated Starliner spacecraft program, which still isn't flying, and is looking increasingly obsolete as SpaceX works to make its Starship spacecraft operational.

So, what does Boeing need to do to ensure its turnaround sticks? Keep doing the things that make it money, and stop doing the things that lose it money. Ultimately, it's as simple as that.

Rich Smith has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Boeing. The Motley Fool has a disclosure policy.

Uh-oh. Here we go again!

It's been nearly five years since Sir Peter Beck, the founder and CEO of Rocket Lab (NASDAQ: RKLB), announced plans to build a Neutron rocketship in 2020. The 43-meter-tall craft, incorporating an expendable second stage within a reusable first stage, can carry 13 tons of cargo to Low Earth Orbit -- 43 times the payload of Rocket Lab's current Electron rocket.

Assuming, that is to say, it ever launches.

Rocket Lab, you see, has been promising to launch Neutron for years -- first positing a 2024 launch date, then "mid-2025," followed by late 2025, Q1 2026, and most recently late 2026. Last month, the deadline slipped yet again when Beck told investors on a conference call he was targeting "delivery of Neutron to the pad in Q4 2026."

That sounds like a reiteration of the late 2026 goal. Unfortunately, delivering the rocket to the pad is just the first step. Next follows a series of pre-launch tests preceding the actual launch.

And as a result, it's entirely possible we won't see Neutron take off before 2027.

Image source: Rocket Lab.

"An-ti-ci-pa-tion, anticipa-yay-shun! [Rocket Lab's] making us wait"

As you can imagine, investors in Rocket Lab stock are getting just a wee bit impatient with all the delays. And Rocket Lab stock is down 24% in the past two weeks, or nearly $20 per share.

The distress is understandable. (Still, one imagines they'd be even more upset if Rocket Lab moved too fast and launched a rocket that blew up!) Bearing that in mind, here's another date that Rocket Lab investors might want to focus on instead, just in case Rocket Lab has to delay launch yet again:

June 30, 2027.

What happens on June 30, 2027?

Three months ago, Rocket Lab announced it would acquire iconic satellite communications company Iridium Communications (NASDAQ: IRDM) in an $8 billion deal slated to close in "mid-2027."

Granted, that deadline's a bit fuzzy. But June 30, 2027, is about as close to mid-2027 as one can get, so that's the date I'm hoping we will see Iridium officially become part of Rocket Lab. And why is this important?

Why Iridium is important to Rocket Lab

Neutron is great and all, don't get me wrong. I'm personally looking forward to seeing it fly -- maybe even in person!

But as an investor, I realize that even the $50 million in revenue Neutron will bring to Rocket Lab with each flight, with 44% gross margins, pales in significance to the $884 million in annual revenue -- with 72% gross profit margins, according to data from S&P Global Market Intelligence -- that Rocket Lab will receive once it acquires Iridium.

Analysts forecast that in 2027, Iridium will earn more than $135 million in GAAP profit and generate more than $313 million in positive free cash flow. That's enough profit and cash to offset all the losses and cash burn at Rocket Lab, and turn Rocket Lab instantly profitable and free cash flow-positive -- a full year before Wall Street analysts anticipated that would happen.

To me, this makes June 30, 2027, the date to watch. Assuming Rocket Lab can close the deal on time, it'll be a much more attractive investment on that date -- with Neutron or without it.

Rich Smith has positions in Rocket Lab. The Motley Fool has positions in and recommends Rocket Lab. The Motley Fool has a disclosure policy.

Two months ago, Elon Musk made a bold claim. (I know. Shocking!) Explaining in its initial public offering (IPO) prospectus why Space Exploration Technologies (NASDAQ: SPCX) was justified in asking investors for a valuation more than $1.5 trillion, Musk & Co. asserted that, in the not-too-distant future, its products and services would serve a $28.5 trillion market for space, connectivity, and artificial intelligence (AI) services.

And the biggest of these was AI.

According to Musk, AI is a market opportunity of $26.5 trillion.

Image source: Getty Images.

SpaceX argues, Anthropic echoes

Such a gargantuan number obviously stuck with me. And when another AI company -- Anthropic -- announced last week that, in its opinion, the total addressable market (TAM) for AI services could reach $30 trillion, well, that rang a big bell.

Anthropic reported $11.6 billion in revenue in the second quarter (Q2) of 2026, more than doubling year over year. According to The Wall Street Journal, the company earned a "small operating profit" as well. But Anthropic sees even bigger things ahead for it as its TAM swells to $30 trillion and beyond.

So, $26.5 trillion? $30 trillion? These are big numbers, and they're suspiciously close to each other. But that's not the only thing they have in common. Anthropic says it's targeting a TAM comprising "the full scope of work that could be completed with AI models," according to the Journal. And it can reach this TAM if it can "theoretically capture ... 100% market-share."

Emphasis on "theoretically."

But here's the problem: Estimating the size of a company's TAM requires "a bit of guesswork," says the Journal. Rarely does the company approaching an IPO tell you exactly what it includes in its TAM. Even more rarely does it tell you when it expects to achieve the TAM it cites.

Unlike actual market-share reports, says the Journal, TAM estimates are "especially squishy."

Which is another way of saying it's impossible to verify them before the IPO has happened -- by which time it may be too late.

Examples from history

Need examples? In 2019, ride-share company Uber (NYSE: UBER) told investors that its TAM was $6 trillion. But how much revenue did Uber actually pull in last year? $52 billion. Or about nine-tenths of one percent of what it cited as its TAM.

In 2021, Rivian Automotive (NASDAQ: RIVN) claimed its TAM was $9 trillion. Last year, Rivian booked less than $5.4 billion in revenue -- less than one-tenth of one percent of the claimed TAM.

In 2023, Instacart (NASDAQ: CART) targeted a $1.1 trillion TAM in groceries. Amazingly, Instacart was the most accurate of these three companies. Its revenue in 2025 was $3.7 billion, or about 3.4% of its TAM estimate.

What's the upshot for investors?

What lesson should investors draw from the above?

Not that TAM is necessarily complete bunk. I suppose if you look out far enough, a TAM in just about anything can grow into any number you like; it just may take a few decades, or centuries, for that to happen. If a company wants to hypothesize a bright future far in the distance and not pin a precise date to it, then, technically, I suppose there's no reason they shouldn't be allowed to do that.

Your job, however, is to realize that when a company like Uber, Rivian, Instacart -- or SpaceX and Anthropic -- gives you a TAM, it's more of a marketing ploy than a realistic prediction of the near future.

You should also be aware that two things can be true at once. SpaceX and Anthropic may both estimate the AI economy will grow to $30 trillion eventually. They may even be right! But if SpaceX and Anthropic are both targeting this same $30 trillion AI market, neither one of them is going to own all 100% of it. It's much more likely that SpaceX will claim one sliver of the market, Anthropic another -- with rivals such as OpenAI, Microsoft, Meta (NASDAQ: META), and DeepSeek all claiming their pieces of the pie as well.

Ultimately, no matter how big the TAM, every one of these companies is going to have to share with the others, and no one of them is going to get anywhere near the full $30 trillion. Caveat investor.

Rich Smith has positions in Meta Platforms. The Motley Fool has positions in and recommends Meta Platforms and Microsoft. The Motley Fool recommends Instacart and Uber Technologies. The Motley Fool has a disclosure policy.

Rocket Lab (NASDAQ: RKLB), the once-tiny space stock that wants to be Space Exploration Technologies when it grows up, held its IPO (albeit as a special purpose acquisition company) just over five years ago. If you'd put $10,000 into Rocket Lab back then, you'd be sitting on more than $65,000 today -- a total return of more than 560%.

And good for you if you did that! Newer investors, though, may be more interested in knowing what $10,000 invested in Rocket Lab stock now will be worth in another five years.

And that's what I'm going to try to figure out today.

Image created by JesterAI.

The trouble with forecasts

Allow me to begin with a disclaimer: No one knows for certain what will happen to Rocket Lab over the next five years. It could explode (in a good way), delivering another 560% return. Or it could explode in a very bad way, for example, if one or more Rocket Lab rockets literally blow up on launch, shaking investor confidence in the space company.

The truth is, anything can happen in half a decade. Bear that in mind as you continue reading.

What analysts say

An inability to know the future has never discouraged Wall Street's best and brightest analysts from trying to predict it. In the case of Rocket Lab, analyst forecasts see Rocket Lab turning profitable for the first time in 2028 and steadily increasing its earnings power to as much as $1.1 billion by 2031.

Rocket Lab might become even more profitable on a cash basis that year, generating positive free cash flow of $1.5 billion -- and that's just to start with.

In June, Rocket Lab announced it would acquire iconic satellite communications company Iridium Communications in an $8 billion deal slated to close in mid-2027. Iridium is already profitable and free cash flow positive. Although a slower grower than Rocket Lab, the company is expected to grow its profits by 13% annually over the next five years.

By 2031, this might result in $190 million in profit and more than $570 million in free cash flow.

How much will Rocket Lab be worth in five years?

If the merger happens as planned next year and both companies (now independent) continue to grow as analysts anticipate, by 2031, a combined Rocket Lab-plus-Iridium might conceivably earn $1.3 billion and generate more than $2 billion in free cash flow annually.

How much would this be worth to investors?

That depends largely on the multiple-to-earnings that investors would be willing to pay for a slower-growing Rocket Lab five years from now. Would they pay, for example, the 54x trailing earnings valuation that Iridium alone fetches today?

With analysts forecasting Rocket Lab's earnings to grow by an average of 60% from 2030 to 2035, that seems reasonable to me -- maybe even conservative. And if I'm right, a valuation of $70 billion (or 75% more than Rocket Lab's current $40 billion market capitalization) seems reasonable.

This is only a guess, of course, albeit as educated a guess as I can make. But if I'm right, a $10,000 investment in Rocket Lab could be worth $17,500 in five years.

Rich Smith has positions in Rocket Lab. The Motley Fool has positions in and recommends Rocket Lab. The Motley Fool has a disclosure policy.

ChangXin Memory Technologies' IPO shook the stock market to its core.

It was almost exactly one month ago that CXMT debuted on the Shanghai stock exchange, raising $8.6 billion to fund production expansion and reaching a $487 billion market capitalization after its stock ran up 466% in a single day. Investors in Micron (NASDAQ: MU) stock, meanwhile, had a very different reaction to CXMT's arrival. Micron stock dropped 9% on CXMT's IPO day. (And fell another 10% the next day.)

And now you know why.

Image source: Getty Images.

Introducing CXMT

China's largest manufacturer of DRAM computer memory chips, CXMT, poses an indirect threat to Micron's DRAM business today -- and potentially a far more direct threat in the future. As CNBC has reported, beginning at the end of 2026, CXMT will produce specialized, stacked DRAM chips to sell as "high bandwidth memory" -- HBM, essential for artificial intelligence operations. HBM is a key growth market for Micron.

And soon, CXMT will be competing to own it.

How effective a competitor will CXMT be for Micron? As it so happens, the company gave investors a glimpse of the answer to that question because last week -- just a month after going public -- CXMT reported its earnings for the first half of 2026.

CXMT H1 earnings

CXMT grew its revenue by 874% year over year in H1 2026, as Reuters reports, reaching 150.3 billion yuan ($22.4 billion USD) and earning 77.6 billion yuan ($11.5 billion) in net profit on these sales. That's a 51.6% net profit margin for the company -- not quite as good as the 63% net profit margin that Micron earned in the same period, according to data from S&P Global Market Intelligence, but the gap is closing quickly.

As recently as last year, CXMT's net margin was negative.

Nor is CXMT's profit margin the only thing that's growing quickly. The company's sales growth rate of 874% outclasses Micron's 203% by a factor of four, implying that not only is CXMT getting more profitable, but it's also doing so while it expands and takes market share from Micron and other rivals.

Which, in turn, implies that CXMT's prices must be significantly lower than Micron's -- yet more profitable for CXMT despite the lower price points.

Prediction: What's next for CXMT

S&P puts CXMT's current market capitalization at $582.5 billion, up 20% over the past month, on top of its IPO day gains. According to The Wall Street Journal, the company -- virtually unknown before its IPO -- has rocketed to become "the world's fourth-largest manufacturer of DRAM memory."

WSJ further notes that CXMT has an 11% market share in DRAM globally, versus 25% for Micron (the world's third-largest DRAM manufacturer after Samsung at 39% and SK Hynix (NASDAQ: SKHY) at 26%). And WSJ estimates CXMT will grow its market share to 15% by 2030.

I personally think that estimate's too conservative.

Why? Consider that Micron itself grew its DRAM market share from 22% to 25% in just one year, from 2025 to today. If CXMT is already expanding sales as fast as it seems to be, and is charging low enough prices to explain the kind of sales growth the company is seeing, and is enjoying the financial and regulatory support of the Chinese Communist Party in its home market, then I predict CXMT will accelerate its market share growth.

One caveat: According to the Journal, CXMT trails Samsung, SK Hynix, and Micron "by two or three generations" in DRAM technology. It's going to take the company some time to play catch-up. Investors should anticipate that CXMT will first begin grabbing market share in low-end DRAM markets for mobile devices, for example, before challenging Micron in the HBM market for artificial intelligence systems.

But make no mistake: CXMT is coming for Micron's most valuable market.

And Micron's margins are at risk.

Rich Smith has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Micron Technology. The Motley Fool has a disclosure policy.

In the summer of 2025, I took a little road trip -- all the way out to the Virginia coast. There I witnessed firsthand the grand opening of Rocket Lab's (NASDAQ: RKLB) newest and grandest piece of infrastructure, a towering launch pad from which the first Neutron rocket would (I was assured) make its inaugural voyage in just a few short months.

It's been a year since I made that trip. Neutron still hasn't launched.

Image source: Rocket Lab.

What is Neutron?

Sir Peter Beck, the founder and CEO of Rocket Lab, first announced he would build the Neutron medium-lift vehicle in 2020, envisioning it as a 40-meter-tall, "8-ton class reusable rocket" powered by seven Archimedes engines in its reusable first stage and a single vacuum-optimized Archimedes in its second stage (carried internally by the first stage).

Neutron has since evolved into a 43-meter rocket powered by nine engines in the first stage, capable of lifting a payload of 13 tons (if the rocket is reusable; 15 tons if it is expended). And in a big reveal at the grand opening, Rocket Lab dropped a hint that the new and improved Neutron might even be capable of carrying astronauts to space.

How big a deal is Neutron?

Thirteen tons of reusable payload carried within a five-meter payload fairing makes Neutron ideal for launching entire constellations of small satellites into orbit -- aligning perfectly with Rocket Lab's plan to buy Iridium Communications (NASDAQ: IRDM), which deploys and operates such constellations. This purchase will transform Rocket Lab into a wholly vertically integrated space company that can build and launch and that can deliver satellite services on its own.

Combined with the potential to launch humans as well as satellites into orbit, it opens new markets for Rocket Lab -- crew transfer to the International Space Station or private space stations, for example; missions to the Moon; even space tourism, potentially.

All of this is in addition to simply using Neutron as a commercial launcher for other companies' payloads. At an estimated $50 million launch price and a target cadence of seven launches per year, Neutron could add $350 million a year to Rocket Lab's revenue stream.

Delayed!

At this point, a lot of investors are worried because Neutron hasn't launched yet -- indeed, it doesn't have a firm target date for launch anymore. While there's still hope the rocket might take off before the end of 2027, many pundits speculate that Neutron's inaugural launch may slip into 2027.

How bad would this be for Rocket Lab?

Although it clearly hasn't been great news for Rocket Lab stock lately, in the long term, it won't affect Rocket Lab's business all that much. As Peter Beck has explained, the company plans to launch Neutron only once in its first year of operation (then three times in its second year and five times in its third). At $50 million per launch, therefore, even a full year's delay would subtract only about $50 million from Rocket Lab's forecast revenue.

That's not enough to move the needle or prevent Rocket Lab from becoming profitable in 2027 by virtue of the Iridium merger. Admittedly, if that should fall through as well, there would be more cause for near-term concern. But in and of itself, a few months' delay in Neutron's first launch shouldn't affect Rocket Lab's business much at all.

Rich Smith has positions in Rocket Lab. The Motley Fool has positions in and recommends Rocket Lab. The Motley Fool has a disclosure policy.

Fair Isaac Corporation (NYSE: FICO) stock, home of the famous FICO score, tumbled 17.8% through 10:55 a.m. ET Friday. You can blame the Trump Administration for that.

And U.S. Federal Housing Finance Agency Director Bill Pulte in particular.

Image source: Getty Images.

Bill Pulte spooks the market

Pulte announced last night that he has directed the heads of Fannie Mae and Freddie Mac to accept mortgage loans for purchase from banks when those loans were issued in reliance on a Vantage credit score rather than the more traditional FICO score. Created in 2006 as an alternative to FICO, Vantage is a credit score created in cooperation by the three major credit bureaus, Equifax, Experian, and TransUnion.

It's failed to reach critical mass since then, but with a helping hand from the U.S. government, investors are wondering whether this time might be different -- and whether that could be bad news for FICO.

What it means for FICO

The Trump Administration has criticized Fair Isaac for contributing to the high cost of homeownership by charging excessive rates when banks pull FICO scores for mortgage applicants -- and has promised to lower the cost of home ownership. The push to introduce competition to FICO by encouraging the use of Vantage scores is part of this effort.

It might even work. Vantage's owners have advertised $0.99 prices for pulling a single credit score, whereas Fair Isaac charges $10 or more (often much more). While a $9 difference might not make much of a dent in the cost of homeownership, therefore, if price competition forces Fair Isaac to cut prices on its premier product, that could have a significant effect on FICO's profitability.

That's what's got investors in Fair Isaac stock feeling nervous today.

Rich Smith has no position in any of the stocks mentioned. The Motley Fool recommends Fair Isaac. The Motley Fool has a disclosure policy.

Micron (NASDAQ: MU) stock jumped 4.5% through 10:35 a.m. ET Friday -- and you can thank private equity firm Lynx Equity for that.

In a note out last night, Lynx predicted a "breakout" for Micron stock, reiterating its opinion that $1,000 Micron stock could rise more than 30% to hit $1,325 within a year.

Image source: Micron.

Why Lynx loves Micron stock

Lynx didn't always feel this way. As recently as June, Lynx was warning investors away from Micron, calling the stock "uninvestible" because of the massive swings in its stock price as momentum traders poured into -- and out of -- Micron on little more than hype and enthusiasm for the AI revolution.

Make no mistake. Lynx thought "the fundamentals remained strong" at Micron, and valued the stock at $1,300-plus. But with Micron trading north of $1,200 already in June, there just wasn't a lot of room for upside -- and too much room for downside if AI investors panicked. (Which they did, sparking a 45% sell-off in Micron stock through late July.

What's next for Micron stock

But that was then, and this is now. And now, thanks to the sell-off, Micron stock is once again trading at levels that give investors a decent chance to earn a profit. (Indeed, up 52% off their lows, Micron's already delivered some nice profits to investors who spotted the opportunity early.)

So are there more gains in store?

Lynx thinks so. Demand for high-bandwidth memory (HBM) is keeping DRAM and NAND spot prices elevated, as StreetInsider.com reports today. And with Micron stock still down nearly 20% from its highs, there's a real chance the stock could "breakout" again, as Lynx predicts.

Priced at 21x earnings, but expecting triple-digit earnings growth over the next five years, Micron stock is priced to move.

Rich Smith has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Micron Technology. The Motley Fool has a disclosure policy.

From a share price just under $65 at the end of July to an intraday high north of $86 mid-month to... just over $64 at the end of August, Rocket Lab (NASDAQ: RKLB) stock went full circle last month. Eventually, the stock ended up not just back where it started but actually a bit below. Investors seem to have cooled to the idea that Rocket Lab might become "the next SpaceX."

Meanwhile, Space Exploration Technologies (NASDAQ: SPCX) stock is up 30% in August.

Image source: Getty Images.

Should you ignore Rocket Lab?

Why do investors seem to be ignoring Rocket Lab? Why are they flocking to SpaceX stock instead -- and are they right to do so? Because it's not as if Rocket Lab has been reporting bad news lately.

On Aug. 20, Rocket Lab announced its 93rd successful Electron rocket launch, delivering an Earth-imaging satellite to orbit for longtime customer Institute for Q-shu Pioneers of Space. (iQPS). With 14 launches so far this year, Rocket Lab's on pace to at least match last year's record of 21 launches by the end of this year -- and possibly surpass it.

On Aug. 18, the U.S. Space Force picked Rocket Lab to join its Space Data Network Consortium, awarding the company $12 million to work on the Space Data Network Backbone (SDN-B), a "secure, high-speed global satellite communications network for military operations."

Just one day earlier, on Aug. 17, Space Force also drafted Rocket Lab to work on its NITE-STAR program, a $981 million umbrella contract "to support a distributed test and training architecture to help prepare [Space Force officers] for contested scenarios."

And of course, there's the transformative deal Rocket Lab announced in June. Buying Iridium Communications (NASDAQ: IRDM) for $8 billion -- just 20% of its own market capitalization -- Rocket Lab immediately straightened its path to profitability, and prepared to leapfrog other unprofitable space stocks to become both generally accepted accounting principles (GAAP) profitable and free cash flow positive as early as next year.

With successes like these, why would anyone prefer to own SpaceX?

Why you might prefer to own SpaceX over Rocket Lab

Not to put too fine a point on it, but the primary reason investors might prefer SpaceX stock over Rocket Lab is that SpaceX is light-years ahead of Rocket Lab (and everyone else) in space tech.

Rocket Lab may have launched 93 rockets in its lifetime, for example, but SpaceX launched nearly twice that -- 165 rockets -- in 2025 alone. What's more, Rocket Lab's launches currently max out at 300 kilograms of payload to orbit with the expendable Electron rocket -- versus SpaceX's payload of 22,800 kilograms with the reusable Falcon 9.

Rocket Lab is working on a bigger, reusable rocket of its own, the Neutron medium-lift vehicle. It was supposed to conduct its inaugural launch in 2025, however, and be in regular rotation this year -- but 2026 is three-quarters over, and Neutron has yet to leave the launchpad even once.

Meanwhile, SpaceX has conducted 13 test flights of its next-generation launch vehicle, the reusable Starship -- and targets 10,000 launches per year within a few years of Starship being certified for flight.

We're aiming to reach 30+ Starship launches/day in 2030, which is ~10k annualized.

Still tiny numbers compared to airplane flights!

-- Elon Musk (@elonmusk) Aug. 21, 2026

With a 100-ton-plus payload to low earth orbit and a launch cost measured in single-digit millions, Starship promises to outclass every other family of rocket launchers on the planet, Rocket Lab's Neutron included, on payload, launch frequency -- and price.

Reasons galore

And that's just one aspect of SpaceX's space business. There's also Starlink, the company's satellite communications powerhouse and likely profits driver for SpaceX in future years. Starshield, the militarized version of Starlink. And the Human Landing System, the rocketship that will return astronauts to the moon in 2028. And Terafab. And orbital data centers.

And. And. And.

Mind you, I still have my reservations about the decision to merge SpaceX's superior space businesses with the cash-burning AI businesses of Grok and X. Elon Musk may believe AI is a $26.5 trillion opportunity, but if I were ever to invest in SpaceX, it would be for the business that gave SpaceX its name: space.

Until Rocket Lab (or anyone, really) proves it's able to match SpaceX's achievements not just in one or two of the categories SpaceX created, but to juggle all of them successfully and simultaneously, it's inarguable that SpaceX will remain the single best space company on Earth.

Rich Smith has positions in Rocket Lab. The Motley Fool has positions in and recommends Rocket Lab. The Motley Fool has a disclosure policy.

Argan (NYSE: AGX) stock moved 3.3% higher through 2:20 p.m. ET Thursday after crushing analyst forecasts for sales and earnings last night.

Heading into the company's Q2 report, Wall Street expected Argan to earn only $2.66 per share on $299.4 million in sales. Argan actually earned $3.76 per share on $384 million in sales.

Image source: Getty Images.

Argan Q2 earnings

The engineering and construction company grew its sales an astonishing 61.5% year over year in Q2, and with improved profit margins, that translated into a better operating margin as well. Unfortunately, the tax man noticed Argan's improved earnings and took a significantly bigger bite out of them this year than last, resulting in earnings going up "only" 50%.

Sales grew 53% in the company's power segment -- the only one singled out for special mention. That was less than the overall revenue growth, however, which must mean that Argan's two other businesses -- industrial and teledata -- performed even better.

What's next for Argan stock

Management did not provide specific guidance on what to expect for the rest of this year, but with power continuing to "execute extremely well," a new factory coming online next quarter in industrial, and acquisitions bolstering the teledata business, one imagines the numbers will look pretty good.

On Wall Street, analysts forecast Argan will end this year with nearly $1.3 billion in sales (up more than 35% year over year), and $12.09 per share in profit (up only 24% -- because of the tax bite). With the stock trading for north of 35 times earnings, however, Argan stock already looks priced for the success it's enjoying.

With the stock up more than 72% over the last 52 weeks, most of the gains on this stock may already have been made.

Rich Smith has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

Polestar Automotive Holding UK PLC (NASDAQ: PSNY) stock got demolished this morning, falling 29.4% through 1:50 p.m. ET after reporting earnings for H1 2026.

Wall Street wasn't expecting much from the stock in its report, predicting Polestar would lose money in the quarter. Investors seem to have been taken by surprise, however, by precisely how bad the news was.

Image source: Getty Images.

Polestar H1 earnings

How bad was it? Comparing H1 2026 to H1 2025, Polestar sold 0.4% more electric cars, and made 4.4% less money doing so ($1.4 billion). Gross profit margin improved slightly, but remained negative -- meaning every car Polestar sold was worth more as parts than as a whole.

Selling, general, and administrative expenses were unchanged year over year, however, and increases in other operating costs were largely offset by decreases in spending on research and development. As a result, while operating margins were also negative, total operating and net losses declined in the quarter.

Don't get me wrong -- Polestar still lost $842 million in H1 2026, and that's not a good number. But it was at least 29% less money than Polestar lost in H1 2025.

What's next for Polestar stock

With sales disappointing, Polestar warned that it will reduce its planned production increase this year from double-digit growth to "low-to-mid single-digit volume growth," even as it introduces four new electric car models, including the Polestar 5 and the Polestar 4 SUV.

This isn't an encouraging sign, suggesting management is bracing for a cool reception to its offerings. At the same time, Polestar warns "the market environment is expected to remain highly competitive and volatile." Finally, the company must contend with a U.S. Department of Commerce Bureau of Industry and Security ban on the sale of 2027 model-year Polestars in America.

Things are looking grim for Polestar.

Rich Smith has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

Ciena (NYSE: CIEN) stock tumbled 9.5% through 1:30 p.m. ET Thursday despite beating on earnings this morning.

Heading into the company's fiscal Q3 2026 report, analysts forecast Ciena would earn $1.72 per share (non-GAAP) on $1.63 billion in sales. In fact, Ciena earned $2.11 per share on $1.67 billion in sales.

So why aren't investors cheering Ciena's performance?

Image source: Getty Images.

Ciena Q3 earnings

Sales, after all, surged 37% year over year in Q3, and non-GAAP earnings more than tripled. Earnings calculated under generally accepted accounting principles (GAAP) weren't quite as good as the non-GAAP number, but at $1.83 per share, were still five times as much as Ciena earned in Q3 2025.

CEO Gary Smith called the company's performance last quarter "outstanding" and confirmed, "AI continues to drive compounding waves of network investment."

CFO Marc Graff predicted Ciena will deliver "increasingly profitable growth" as it expands its production capacity to support the AI revolution.

What's next for Ciena stock

What does this mean for investors?

Ciena forecasts that it will deliver about $1.75 billion in revenue in Q4. Management didn't provide GAAP earnings guidance but noted that its gross profit margin for the quarter will be only about 45%. While that's within the margin of error for the 45.4% gross margin Ciena reported for Q3, it still suggests margins might dip slightly.

Is 40 basis points of gross margin slippage enough to explain the stock's near-10% sell-off today? Actually, it may be -- when you consider how priced for perfection Ciena stock already was. Valued at 120 times earnings, Ciena might be worth its price if it succeeds in averaging 75% annual earnings growth over the next five years, as Wall Street forecasts.

If margins suffer and Ciena's growth slows, however -- look out below.

Rich Smith has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Ciena. The Motley Fool has a disclosure policy.

Broadcom (NASDAQ: AVGO) stock -- which really needs to get around to updating its ticker symbol one of these days -- tumbled 6.3% through 10:30 a.m. ET Thursday despite beating on earnings last night.

Heading into the company's fiscal Q3 2026 report, analysts forecast Broadcom would earn $3.21 per share (non-GAAP) on $29.2 billion in sales. In fact, Broadcom earned $3.32 per share on $29.6 billion in sales.

It might not have been a blowout, but it certainly was a beat, so why aren't investors more impressed?

Image source: Getty Images.

Broadcom Q3 earnings

After all, Broadcom grew its sales 86% year over year in Q3. GAAP profits weren't quite as strong as non-GAAP, but calculated under generally accepted accounting principles (GAAP), earnings per share still more than tripled to $2.68, and free cash flow zoomed 34% higher to $13.7 billion!

All things considered, it was a terrific quarter.

What comes next for Broadcom stock

The question investors are asking, though, is whether Broadcom can keep this up? Turning to guidance, Broadcom CEO Hock Tan confirmed "demand for our custom AI accelerators and networking continues to be very strong" and "the momentum continues" as we enter Q4, with AI semiconductor revenue expected to triple again to $21.7 billion.

Assuming this happens, Broadcom might reach $34.8 billion in Q4 sales, with AI accounting for 62% of the total. Problem is, as good as this sounds, Wall Street was expecting Broadcom to predict more than $35 billion. When Broadcom failed to do that, they basically marred their Q3 earnings beat with a Q4 guidance miss -- and that's what's upsetting investors today.

Personally, I think selling Broadcom stock is a bad call. With a 61x price-to-earnings ratio and projected 60% annual growth over the next five years, the stock looks fairly priced to me.

Rich Smith has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Broadcom. The Motley Fool has a disclosure policy.

Defense and artificial intelligence stock Palantir Technologies (NASDAQ: PLTR) soared 9.1% through 10:10 a.m. ET Thursday on no obvious good news. Rather, investors appear to be reevaluating precisely how bad yesterday's news was -- and deciding it wasn't nearly as bad as it appeared.

Image source: Palantir.

Missed Nvidia in 2009? This Rare Signal Is Flashing Again. In 2009, a "Double Down" signal flashed for a little-known chipmaker called Nvidia. For the first time in years, that same "Total Conviction" signal is flashing for a company 1/100th the size of Nvidia. Continue »

What happened to Palantir Wednesday

Shares of Palantir tumbled nearly 6% yesterday after tech giant Alphabet (NASDAQ: GOOG) (Nasdaq: GOOGL announced it will make its specialized "Gemini 3.8 Flash Cyber" AI model available exclusively to government buyers through a new initiative called the "Fairwind Program."

Gemini 3.8 Flash Cyber is described as a specialized artificial intelligence model built explicitly for cybersecurity, vulnerability detection, and automated patching, and of special interest to the U.S. military. As such, investors view it as a rival to Palantir's government security franchise and its profitable defense market.

What it means for Palantir stock

So far, so bad. This is a threat to Palantir's growth prospects -- but how big a threat remains to be seen. After all, Palantir's government contracting business grew 53% last year, and accelerated to 79% growth in the most recent quarter, according to S&P Global Market Intelligence data.

So Google isn't slowing Palantir down much yet.

That said, Investing.com argues investors have been looking for any excuse to sell Palantir due to "ongoing scrutiny over its high valuation multiples." And that's where I differ from the experts' analysis.

Priced north of 150 times GAAP earnings and close to 120 times free cash flow, Palantir stock may look expensive. But most analysts agree Palantir is on course to grow its earnings 54% annually over the next five years, and so far, Palantir isn't just meeting those targets. It's exceeding them. Meanwhile, Google's only growing at a sedate 15%.

I wouldn't count Palantir out of this race just yet.

Rich Smith has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Alphabet and Palantir Technologies. The Motley Fool has a disclosure policy.

California electric utility stock PG&E Corporation (NYSE: PCG) crashed more than 20% on Monday after a legislative effort in Sacramento to limit utilities' exposure to lawsuits from insurance companies fell apart.

PG&E stock bounced back a bit Tuesday (probably from short-sellers covering their shorts), but resumed falling this morning, and is now down 9.6% through 10:25 a.m. ET.

Image source: Getty Images.

California news at 11

As Sacramento NBC affiliate KCRA 3 reported over the weekend, Gov. Gavin Newsom had been working to secure legislation that would partially insulate PG&E and similar utilities from liability for wildfires caused by equipment malfunctions by limiting insurers' ability to sue for reimbursement of claims paid to their insured homeowners. Legislators rejected this legislation, however, sending PG&E stock into freefall amid worries that the company wouldn't be able to afford to compensate homeowners for wildfire damage.

Now it seems PG&E may not be able to afford not causing wildfires, either!

As the company announced this morning, "PG&E plans to defer approximately $2 billion of [capital improvement] work in 2027." Management didn't directly tie the $2 billion to additional litigation costs, but it obliquely referred to a "wildfire liability framework" that creates "financing risks that drive higher costs."

It's not hard to connect the dots here.

Catch-22 for PG&E

Reading between the lines, it sounds like PG&E is caught in a Catch-22. On the one hand, wildfires cause damage that cost it money. On the other hand, preventing wildfires by improving the safety of its electrical infrastructure equipment also costs money.

There's not enough money to go around, however. And the solution PG&E seems to have struck upon -- or is threatening to take -- is to skimp on safety and just hope another fire doesn't happen. I don't know about you, but that's not the kind of stock I want to own.

Rich Smith has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

In a note released yesterday, Scotiabank analyst Patrick Colville raised his price target on Palo Alto Networks (NASDAQ: PANW) stock ahead of earnings, predicting a strong report, but arguing even if Palo Alto missed, investors shouldn't sell the stock.

Well, Palo Alto just released earnings.

And as of 9:45 a.m. ET, its stock is down 9%.

Image source: Getty Images.

Palo Alto Networks Q4 earnings

Seems somebody wasn't buying what Scotiabank was selling. So what went wrong?

Palo Alto grew its revenue 34% year over year in Q4, passing $3.4 billion in sales versus the $3.35 billion Wall Street was looking for. GAAP results showed a $0.35 per share loss for the quarter, reversing the $0.36 per share profit Palo Alto earned in last year's Q4. Luckily for Palo Alto, its adjusted (non-GAAP) earnings -- which are the ones Wall Street focuses on -- came in at $1.02 per share, four cents more than expected.

Free cash flow was $1.3 billion for the quarter.

For the year, Palo Alto reported $11.5 billion in total revenue, $0.40 per share in GAAP profit, and free cash flow of $4.1 billion.

Is this good news or bad news for Palo Alto stock?

Is this something that should make Palo Alto investors happy or sad? Well, the GAAP number certainly underwhelms. Compared to the $1.60 Palo Alto earned in fiscal 2025, $0.40 represents a 75% year-over-year decline in profit per share. $4.1 billion in free cash flow, on the other hand, is up 17%.

Still, on a $295 billion market capitalization, that's a 72x price-to-free cash flow ratio we're looking at in Palo Alto. That's a high price to pay for only 17% growth, forcing me to agree with the rest of the market today: Palo Alto Networks stock is a sell.

Rich Smith has no position in any of the stocks mentioned. The Motley Fool recommends Palo Alto Networks. The Motley Fool has a disclosure policy.

Rezolve AI PLC (NASDAQ: RZLV) stock tumbled 19.2% through 10:40 a.m. ET Tuesday after reporting an "approximately 1,970%" increase in sales for the first half of 2026.

Which seems like a strange reaction to 20-fold growth. Is it wrong?

Image source: Getty Images.

Rezolve Q2 earnings

When last we heard from Rezolve in June, the UK-based artificial intelligence company was promising to "reshape ... the approximately $30 trillion global retail industry with leading industry forecasts," predicting "AI and agentic commerce could mediate between $3 trillion and $5 trillion of global commerce by 2030."

Those are some big numbers. In Q1 2026, Rezolve's own piece of this market was still only $60 million -- but already more than the $47 million the company collected in revenue in all of 2025!

Three months later, Rezolve just grew its quarterly revenue 18% sequentially to $70.8 million, bringing its total for the first half to $130.8 million. What's more, management says its revenue is "seasonally weighted toward H2," implying the last two quarters of this year should be even stronger than the first two.

What's next for Rezolve stock

Rezolve isn't yet GAAP profitable. The company earned a 48.9% gross profit margin in H1, but operating costs and charges put its bottom line deep in the red -- a $139.5 million net loss, or more than twice last year's H1 loss.

That's probably the reason Rezolve stock is down so much.

That said, management seems confident in its business plan. Turning to guidance, Rezolve predicts it will collect $360 million in revenue and exit the year with a $500 million annual recurring revenue run rate. That won't be enough to turn the company profitable this year (or next year either, according to analysts).

But maybe in 2028? Fingers crossed!

Rich Smith has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

Palo Alto Networks (NASDAQ: PANW) stock probably should have gone up today. Instead, it's going down -- off 4.7% as of 10 a.m. ET.

Shares of the cybersecurity company should have gotten a boost this morning when Scotiabank analyst Patrick Colville raised his price target to $430 per share. So why aren't investors taking their cue from Scotiabank and buying?

Image source: Getty Images.

Why Scotiabank loves Palo Alto Networks stock

Surveying institutional investors, Scotiabank reports that "Palo Alto Networks remains strategically well liked," which should mean good things for the stock -- and probably helps explain why Palo Alto stock has doubled over the past 52 weeks. The question is whether Palo Alto will remain popular after reporting Q4 earnings this evening?

According to Yahoo! Finance estimates, most analysts expect Palo Alto to report $3.35 billion in Q4 sales (32% growth from last year's Q4) and $11.4 billion in annual sales for all of fiscal 2026 -- growing to $13.8 billion in fiscal 2027. These are the consensus targets.

What's strange is that, according to Colville, Palo Alto stock should be able to hold onto its share price (i.e., remain "flat" after earnings) so long as it reports $9 billion in annual recurring revenue at the end of 2026 (which you'll notice is less than $11.4 billion), and guides to only $11.1 billion in fiscal 2027 (which you'll notice is much less than $13.8 billion)!

What's next for Palo Alto stock

Is Scotiabank trying to prepare investors for disappointment if Palo Alto promises less revenue in 2027 than the consensus tonight? It kind of feels like it. At the same time, the analyst notes that "PANW shares [cost] double their five-year average EV/EBITDA valuation."

To me, this sounds like the stock is overvalued and will fall if it misses on guidance tonight.

Rich Smith has no position in any of the stocks mentioned. The Motley Fool recommends Palo Alto Networks. The Motley Fool has a disclosure policy.

California electric utility stock Edison International (NYSE: EIX) crashed 24.2% through 2 p.m. ET Monday after a legislative effort in Sacramento to limit utilities' exposure to lawsuits from insurance companies fell apart over the weekend.

Image source: Getty Images.

Missed Nvidia in 2009? This Rare Signal Is Flashing Again. In 2009, a "Double Down" signal flashed for a little-known chipmaker called Nvidia. For the first time in years, that same "Total Conviction" signal is flashing for a company 1/100th the size of Nvidia. Continue »

Today's news in California

As Sacramento NBC affiliate KCRA 3 reports, Gov. Gavin Newsom was promoting legislation that would partially insulate Edison International and similar utilities from liability for wildfires caused when their equipment malfunctions. When homes are destroyed in a wildfire, homeowners file home insurance claims with their insurance companies -- which in turn try to "subrogate" their liability by suing the electric utility they deem responsible for the fire.

The legislation in question would have prevented insurance companies from suing utility companies, resulting in the insurers -- not the utilities -- bearing the cost of wildfires. Problem is, the insurers point out that if they're required to bear the full cost of wildfires that result from circumstances outside their control (and more within the utilities' control), they'll need to raise customers' insurance premiums, or even drop insurance for homeowners in high-risk areas.

This argument ultimately prevailed, and legislators refused to go along with the Governor's proposal.

What's next for Edison International

It's not a total loss for Edison International. Compromises proposed over the weekend seek to at least discourage frivolous lawsuits by limiting the attorneys' fees that law firms receive after filing wildfire-damage suits. Also, utility company CEOs may be denied bonuses in years their companies cause wildfires.

But the really big ask -- ending subrogation lawsuits -- failed. That's bad news for Edison International stock, and this morning Mizuho Bank downgraded Edison stock to neutral, and lowered its price target to $70.

Investors today seem to think it's worth even less than that.

Rich Smith has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

California electric utility stock PG&E Corporation (NYSE: PCG) crashed 19.6% through 11:50 a.m. ET Monday after a legislative effort in Sacramento to limit utilities' exposure to lawsuits from insurance companies fell apart over the weekend.

Image source: Getty Images.

Missed Nvidia in 2009? This Rare Signal Is Flashing Again. In 2009, a "Double Down" signal flashed for a little-known chipmaker called Nvidia. For the first time in years, that same "Total Conviction" signal is flashing for a company 1/100th the size of Nvidia. Continue »

What's happening in California today

As Sacramento NBC affiliate KCRA 3 reports, Gov. Gavin Newsom was working to secure legislation that would partially insulate PG&E and similar utilities from liability for wildfires caused when their equipment malfunctions. When homes are destroyed in a wildfire, for example, homeowners claim compensation from their insurance companies -- which in turn try to mitigate their own losses by suing the electric utility they deem responsible for the fire. (Legally, the route used to do this is called "subrogation.")

The legislation in question would have prevented insurance companies from suing utilities, resulting in the insurers -- not the utilities -- bearing the cost of wildfires. Problem is, the insurers point out that if they're required to bear the full cost of wildfires that result from circumstances out of their control (and more within the control of utilities), they'll need to raise their insurance premiums, or drop insurance for homeowners in high-risk areas.

Ultimately, this argument prevailed, and legislators refused to go along with the Governor's proposal.

What's next for PG&E

The situation's not a total loss for PG&E. Compromises proposed over the weekend seek to at least discourage frivolous lawsuits by limiting the attorneys' fees that law firms receive for filing wildfire-damage suits. Also, utility company CEOs may be denied bonuses in years their companies cause wildfires.

But on the really big ask -- ending subrogation lawsuits -- they failed. That's bad news for PG&E stock, and it's why PG&E shares are down so much today.

Rich Smith has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

By now you may have heard the news: Elon Musk's Space Exploration Technologies (NASDAQ: SPCX) company is coming to Louisiana -- and bringing a pile of cash along for the ride.

On Aug. 25, SpaceX said it planned to develop a high-volume launch facility for Starship on the Louisiana Gulf Coast. The site will host 10 Starship launch pads, deep-water shipping ports and vehicle processing facilities for receiving cargo, and an airport, and will cost $100 billion to build. It won't all be spent at once, of course, but construction will begin in 2027, with the first launch pad expected to be operational by 2029, and further work continuing after that.

Image source: The Motley Fool.

Arguably even more important than the infrastructure is the location chosen for Starbase Louisiana.

As far back as May, speculation began floating around that SpaceX was interested in Louisiana. One notable post on X (coincidentally, also owned by Elon Musk and part of SpaceX) said that SpaceX "may have acquired or is acquiring 136k acres (212 sq miles) of marshland" on the Louisiana coast. In a flash of insight, this poster observed that the site in question had access to natural gas pipelines owned by Cheniere Energy (NYSE: LNG) and ExxonMobil (NYSE: XOM) subsidiary Golden Pass LNG.

SPACEX: A realtor named Jim Keaty of Keaty Real Estate published a rumor of possible SpaceX land acquisition in Louisiana.

It states SpaceX may have acquired or is acquiring 136k acres (212 sq miles) of marshland south of Highway 82 toward the Gulf of America in Pecan Island... https://t.co/3mv5Do8sTP pic.twitter.com/c36x41kNMw

-- S.E. Robinson, Jr. (@SERobinsonJr) May 4, 2026

And why is that important? Well, consider that every Starship launched consumes about 1,040 metric tons of rocket fuel.

Now, natural gas is primarily composed of methane (as much as 97%). Once purified to remove contaminants such as CO2, oxygen, nitrogen, and other gases, it can be cooled to yield liquid methane -- itself the primary component of methalox rocket fuel.

Translation: SpaceX is building its new Starbase atop two gas lines that already exist, and that deliver straight to Elon Musk's doorstep all the rocket fuel his Starships will ever need.

What this means to investors

Following SpaceX's confirmation of speculation that it will build its second-ever Starbase in Louisiana, many commenters rushed in to opine on the financial wisdom of the move and on SpaceX's ability to raise the $100 billion it expects to spend to complete the project.

Neither of which worries me.

SpaceX has a market capitalization of $1.9 trillion just a little more than two months after its initial public offering (IPO) in June. More importantly, according to the latest data from S&P Global Market Intelligence, SpaceX already has $100 billion in the bank. If Elon Musk were so inclined, he could literally pre-pay to build Starbase Louisiana today and then take all the time he needs to get the 10 launch pads up and running.

As I've stated before, I'm much more concerned about the artificial intelligence (AI) side of SpaceX's business, and the incredible rate at which it's burning cash. (S&P estimates more than $50 billion in negative free cash flow this year, for example -- and twice that next year.) Until that changes, I've honestly got zero interest in investing in SpaceX per se.

But that doesn't mean there's no other way to profit from this Louisiana SpaceX project.

A better way to make money off of SpaceX

I refer, of course, to the two companies we now know will be profiting directly from SpaceX's project in Louisiana by selling SpaceX the rocket fuel it needs for its Starships: Exxon and Cheniere.

Unlike SpaceX, Cheniere stock is profitable, generating $2.9 billion in generally accepted accounting principles (GAAP) earnings and $2.8 billion in positive free cash flow (FCF) during the past 12 months. Likewise, Exxon -- on an even grander scale. During the past 12 months, Exxon earned $32.8 billion and generated $30.6 billion in FCF.

In terms of valuation, both Cheniere and Exxon stocks trade at about 20 times earnings and 21 times FCF. Of the two, I'm inclined to prefer Exxon over Cheniere for its lighter debt load (relative to both market capitalization and earnings), as well as its superior dividend yield of 2.6% -- triple Cheniere's 0.8% dividend yield.

Both stocks, though, stand to benefit mightily from an increase in liquefied natural gas purchases by SpaceX as it constructs Starbase Louisiana -- and both look to me like better bargains than SpaceX stock itself.

Rich Smith has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Cheniere Energy. The Motley Fool has a disclosure policy.

Civilian airplane builder Boeing's (NYSE: BA) on-again, off-again defense business is on once again raking in big contracts -- and earning money on them.

As recently as 2024, Boeing was in the dumps. Boeing reported $12 billion in losses that year, with both its civilian commercial airplanes division and its military-focused defense, space, and security (BDS) unit deeply in the red. The company burned through more than $14 billion in negative free cash flow.

But what a difference a year makes -- and what a bigger difference two years can make!

According to data from S&P Global Market Intelligence, Boeing's losses in commercial airplanes were still above $7 billion last year -- but BDS was close to breakeven. So far in 2026, the plane maker is doing even better. Commercial losses continue to shrink, and BDS is finally back in the black with a $218 million operating profit.

And there may be more where that came from.

Image source: Getty Images.

Boeing's winning contracts again

Boeing pulled a rabbit out of its flight helmet last year when it beat Lockheed Martin for the right to build a new sixth-generation fighter jet for the U.S. Air Force.

Dubbed the F-47 Next Generation Air Dominance fighter, the new airplane will mark a huge upgrade from the Air Force's current top-of-the-line air superiority fighter, the F-22. While details are scarce at this early date, reports indicate that when the F-47 arrives in 2028 (and enters service in the early 2030s), it will bring to the fight advanced stealth and electronic warfare capabilities, the ability to control autonomous drones in combat, and a range nearly twice that of the F-22 -- 1,000 miles.

More importantly for Boeing, the F-47 will bring the company an estimated $20 billion to $50 billion in revenue to first develop the aircraft and then build 185 of them.

This development revenue, which is already rolling in, is presumably already contributing to the turnaround at BDS. It may pale in significance to the company's latest defense win, however. This week, you see, Boeing was awarded an even bigger contract: $131.2 billion.

Boeing's big F-15 win

Announced on Monday, Aug. 24 in the Defense Department's daily digest of contract awards, the new "F-15 Eagle Crest" contract requires Boeing to perform "aircraft production, systems integration, modernization, upgrades, retrofits, sustainment, and the establishment of organic depot maintenance capabilities" across the Air Force's F-15 fleet -- and the air forces of Japan, Indonesia, Israel, Poland, Saudi Arabia, Singapore, and South Korea.

According to data from Flightglobal's 2026 World Air Forces report, the modernizations and upgrades alone could cover a global fleet of at least 897 F-15s -- or more than 1,000 if one counts airplanes ordered but not yet delivered.

It's worth pointing out that not all of the $131.2 billion in the contract may be spent. This figure represents an upper limit on the potential size of the deal and covers work to be performed under an umbrella contract. The final size of the contract will depend on how many task orders to perform work (build and deliver new airplanes, modernize and upgrade, and supply existing aircraft) are placed by the Air Force and the allied nations.

What it means for Boeing investors

But yes, $131.2 billion is a possibility.

Even stretching over a decade (all work is expected to be completed by August 2037), that's a lot of extra money Boeing could make off of F-15 Eagle Crest -- more than $13 billion per year, or enough to add 50% to the company's $27 billion-a-year BDS business.

So this is big news. Is it big enough, though, to make Boeing stock a buy?

That's hard to say for a company like Boeing, still working its way through a near-decade-long turnaround that began when the company started losing money in 2019 -- and continues to this day. Even though Boeing technically returned to profitability last year, its current $166.8 billion market capitalization values the stock at a nosebleed 76 times trailing earnings.

Expect that valuation to drop dramatically, however, as earnings begin growing off their currently low base. And the sooner Boeing starts ramping up earnings at its now-profitable-again defense business, the cheaper Boeing stock is going to look.

Rich Smith has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Boeing and Lockheed Martin. The Motley Fool has a disclosure policy.

The second time was the charm for China -- almost.

On Wednesday last week, Aug. 19, China's LandSpace launched a ZhuQue-3 rocket on its second attempt to make the rocket "reusable." The ZhuQue-3 launched successfully, reached orbital velocity, and deposited a customer's satellite into orbit with its second stage. The rocket's first stage then initiated a reentry burn, returned to Earth, and landed -- just like a SpaceX Falcon 9.

Well, almost like a SpaceX Falcon 9.

Image source: The Motley Fool.

Close, but no cigar

Upon landing, it appears ZhuQue-3 still had a lot of fuel in the tank, which proceeded to burn off after landing, igniting several fires on the landing pad. The heat from these fires melted one of the rocket's landing legs, causing ZhuQue-3 to topple over several hours after landing. LandSpace, which had planned to build a new ZhuQue-3 for Flight 3, then refurbish and reuse this one on its fourth flight, may now need to rethink that plan.

It's still quite an accomplishment for LandSpace, which has come very close to duplicating the success that is Space Exploration Technologies' (NASDAQ: SPCX) Falcon 9 reusable rocket.

LandSpace isn't done imitating SpaceX. Plans (now perhaps set back a bit by the toppling) envision lengthening ZhuQue-3 to 76.6 meters tall, tweaking the design to use more powerful TQ-12B and TQ-15B engines, adding more fuel, and thus upgrading the entire rocket to the point where it can carry payloads of up to 18.3 metric tons to low Earth orbit.

Should SpaceX investors be nervous?

Imitation is the sincerest form of flattery

Not necessarily, not immediately, no.

Consider: Even in the matter of payload, SpaceX retains a sizable advantage over LandSpace. After multiple upgrades over the years, its Falcon 9 now carries a maximum payload to LEO of 22.8 kilograms. That's 25% better than ZhuQue will have even after it completes its upgrade and before LandSpace works out all the kinks of landing and reuse.

Granted, a 25% advantage may not seem quite so impressive given that SpaceX has been launching and landing reusable rockets since 2015 and has more than a decade's head start on LandSpace. Granted, too, LandSpace isn't the only space company that has taken a page from SpaceX's reusability notebook and used it to build reusable rockets of their own.

Right here in America, Jeff Bezos' Blue Origin successfully launched and landed a rocket at sea (an arguably even tougher task than landing on land) on its second try last year. Sir Peter Beck at Rocket Lab (NASDAQ: RKLB) is also working on a reusable spacecraft, the Neutron medium-lift rocket. That one could begin launching in early 2027 -- or even later this year.

At an estimated 13 tons of payload to LEO, Neutron then will be roughly the same size as China's ZhuQue-3 is now.

SpaceX remains best in class

When you do the math, though, these numbers still confirm that SpaceX and its Falcon 9 remain best-in-class in space, offering the longest record of reliability, the biggest payloads, and the best price per kilogram to orbit. And here's the real reveal that shows how far ahead of the competition SpaceX is:

As everyone else on Earth races to catch up to Falcon 9, SpaceX just signaled that Falcon 9 is already obsolete technology and will be discontinued in favor of Starship.

Once Starship is flying reliably several times per week, it makes sense to shift super scarce SpaceX engineering and production resources to Starship to get launch rate to several times per day, which means winding down Falcon

-- Elon Musk (@elonmusk) August 22, 2026

On July 24, SpaceX conducted its most successful Starship test flight yet, using V3 versions of both its Super Heavy booster and Ship second stage to put 20 V3 Starlink satellites in orbit. Ship then conducted a successful soft splashdown in the Indian Ocean, and Super Heavy a (somewhat less) successful landing in the Gulf. With the kinks now mostly worked out on both elements of the craft, SpaceX plans to attempt its first-ever tower-catch landing of the Ship on its 14th test flight next month, setting the stage for full reusability of Starship.

Already, SpaceX is looking forward to the day when Starship is "flying reliably several times per week," carrying more than 100 metric tons to orbit with each flight. Once this goal is reached, Elon Musk plans to begin shutting down Falcon 9 production and switching all SpaceX work to Starship.

By the time LandSpace, Blue Origin, and Rocket Lab finally catch up to SpaceX in the Falcon 9 race, SpaceX will already have moved on to win the next race -- with Starship.

Rich Smith has positions in Rocket Lab. The Motley Fool has positions in and recommends Rocket Lab. The Motley Fool has a disclosure policy.

Easy come, easy go. Six weeks ago, PayPal Holdings (NASDAQ: PYPL) stock went to the moon on reports that the privately held companies Stripe and Advent were offering to buy out PayPal for $53 billion.

Six weeks later, that deal is now dead.

Image source: Getty Images.

PayPal declined

Reports at the time had Stripe and Advent teaming up with publicly traded Block (NYSE: XYZ) to offer $60.50 per share to acquire each share outstanding of PayPal's stock -- a 28% premium to the then-current share price, but still a bargain price at only 11.3 times earnings.

PayPal, unfortunately, was unenthused with the offer and wanted more money -- which the bidders were not willing to pay. Media reports today have Stripe and Advent retracting their offer, and now PayPal stock is in freefall. (I warned you this might happen, by the way.)

As of 1 p.m. ET Friday, the stock is down 12.2% and trading below $54.

What's next for PayPal?

But here's the thing: $54 isn't $60.50 -- but even $54 per share is $8 more than PayPal stock fetched before Stripe and Advent advertised their interest in the firm, reminding investors of just how cheap PayPal stock had gotten. Even without a buyout, therefore, this hasn't been a total loss for PayPal shareholders.

What's more, now that people are paying attention, a different suitor may emerge and offer to pay even more for PayPal. After all, PayPal stock still trades for less than 12 times earnings, and is even cheaper when valued on its superior free cash flow -- about 8x FCF.

With a dividend yield hovering around 1%, and analysts forecasting at least 6% annual earnings growth over the next five years, the worst I can say is that PayPal looks fairly valued. It might easily be cheap enough to buy.

Rich Smith has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Block and PayPal. The Motley Fool recommends the following options: short September 2026 $47.50 calls on PayPal. The Motley Fool has a disclosure policy.

Clothing chain The Gap (NYSE: GAP) stock soared 13% through 11:35 a.m. ET Friday after exceeding analyst targets for earnings last night.

Heading into its Q2 report, Wall Street had Gap pegged for a $0.49 per share profit on sales of $3.7 billion. Gap met the sales forecast and beat on earnings, reporting pro forma profit of $0.52 per share.

Gap Q2 earnings

Not all Gap's news was good. While sales met expectations, they declined 2% year over year, including a 1% decline in same-store sales. Despite investors' positive reception, CEO Richard Dickson called these results "modestly below expectations."

Gap noted that its gross profit margin grew 1,160 basis points -- but refunds of Trump tariffs accounted for 1,1401 of this improvement. Back out the tariff refunds, and the improvement was less than 20 basis points -- moving in the right direction, granted, but only just barely.

One point worth noting, though: The $0.52 per share profit that Gap reported for the quarter does not count the tariff refunds. Factor those into the mix, as earnings calculated under generally accepted accounting principles (GAAP) do, and Gap ended up earning $1.38 per share in the quarter -- nearly three times the headline number!

What's next for Gap stock?

And turning to guidance, the news gets even better: Gap anticipates sales shifting back into growth mode shortly and forecasts sales up 1% to 1.5% by the end of 2026.

Gross and operating profit margins are also expected to rise, resulting in $2.35 to $2.45 per share profit before adding tariff refunds. After adding these refunds, Gap should easily exceed analysts' forecast of $2.72 per share in profit this year.

And the more times Gap beats earnings this year, the higher its stock should soar.

Rich Smith has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

Marvell Technology (NASDAQ: MRVL) stock tumbled 8% through 10:55 a.m. ET Friday despite beating on both top and bottom lines in its fiscal Q2 2027 earnings report last night.

Heading into the report, Wall Street forecast Marvell to earn $0.93 per share on sales of $2.71 billion. Marvell actually earned $0.94 per share on sales of $2.74 billion, eking out wins on both counts.

Image source: Getty Images.

Marvell Q2 earnings

Admittedly, the "$0.94" profit Marvell earned in Q2 was a non-GAAP number. Earnings calculated under generally accepted accounting principles (GAAP) were only $0.33 per share. Still, that resulted in a 50% increase in GAAP profit year over year. Sales grew 37% year over year.

Free cash flow for the quarter -- cash from operations minus the cost of capital spending and technology licenses -- amounted to $474.3 million, a more modest 15% increase versus fiscal Q2 2026 -- but 54% more cash profit than reflected in the GAAP earnings number.

What's next for Marvell Technology stock?

Guidance was pretty great, too. Forecasting $3.15 billion in fiscal Q3 2027 sales, improved gross profit margins (about 53.4%), GAAP profits of about $0.53 per share, and non-GAAP earnings of about $1.10 per share, Marvell met or exceeded analyst forecasts on all counts.

So... why aren't investors more impressed with Marvell's performance?

Valuation is the most obvious answer. On the one hand, Marvell's growing nicely at 15%, 37%, or 50% -- depending on your frame of reference. On the other hand, though, the stock costs a pretty staggering 84x trailing earnings today, resulting in a PEG ratio well above the value investor's touchstone of 1.0.

Merely terrific earnings may not be good enough to support such a high valuation on Marvell stock.

And Marvell stock's next move may be down.

Rich Smith has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Marvell Technology. The Motley Fool has a disclosure policy.

Modern-day five-and-dime retailer Dollar Tree (NASDAQ: DLTR) stock tumbled 3.7% through 1 p.m. ET Thursday despite crushing analyst forecasts for Q2 earnings.

Heading into the report, Wall Street had Dollar Tree pegged for a $1.11 per share profit on $4.85 billion in sales. Dollar Tree beat the sales estimate with $4.9 billion, and more than doubled Wall Street's expected profit, earning $2.70 per share -- then raised guidance on top of that!

So why is Dollar Tree stock sliding?

Image source: Getty Images.

Dollar Tree Q2 earnings

Dollar Tree grew its sales 7% year over year in Q2, helped by a 3.7% increase in same-store sales. The company's net profit of $2.70 per share included a $1.31 benefit from refunds of the Trump tariffs. Even without that windfall, however, the company would have earned $1.39 per share- 25% more than Wall Street analysts had predicted and still a strong beat.

CEO Mike Creedon credited better foot traffic at his stores, and also more spending per customer visit, for the improvement, adding that Dollar Tree is making an effort to run its stores better as well (and this seems to be paying off in the form of more and more freely spending customers arriving in his stores).

What's next for Dollar Tree stock?

Can Dollar Tree keep it up? Management thinks so.

Turning to guidance, Dollar Tree anticipates same-store sales growing 3% to 4% again in Q3, and indeed all year long, resulting in sales north of $5 billion next quarter, and between $20.5 billion and $20.7 billion by year-end. Profits should range from $0.80 to $0.95 in Q3, and from $7.70 to $8.05 per share for the year.

That works out to about a 16x price-to-earnings ratio on Dollar Tree stock. Given how well it's doing, that price seems more than fair.

Rich Smith has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

Best Buy (NYSE: BBY) tumbled 4.3% through 11:50 a.m. ET this morning despite beating on sales, beating on earnings, and issuing raised guidance, too! Expected to earn only $1.35 per share (pro forma) on sales of $9.5 billion, Best Buy delivered $1.47 in profit and sales of $9.8 billion.

So... what's up with that? Why is Best Buy stock down when all it gave investors today was good news?

Image source: Getty Images.

Best Buy Q2 earnings

In fiscal Q2 2027, Best Buy grew its sales by a modest 3.6%, with same-store sales rising slightly faster at 4.1%. Pro forma profits did better, growing 15% year over year, while earnings calculated under generally accepted accounting principles (GAAP) showed tremendous improvement -- up 70%.

Really, the only bad news Best Buy had to offer was this: international sales declined by 4.2%. Still, international is a relatively small part of Best Buy -- and its underperformance was more than offset by outperformance in basically every other segment of the business.

What's next for Best Buy stock?

Can Best Buy continue to outperform? Management seems confident that it can. As it enters the year's back half, Best Buy forecasts fiscal 2027 sales of about $42.5 billion (Wall Street only expects $42.1 billion) and pro forma profits between $6.70 and $6.90 (Wall Street expects $6.62).

In other words, Best Buy should beat on both sales and earnings... all year long!

Admittedly, management did not give a GAAP forecast. But seeing as the difference between GAAP and non-GAAP in Q2 was just one penny, it seems likely GAAP earnings will turn out just fine. Assuming it ends up earning $6.80 or thereabouts this year and is therefore trading at about 12.2x current-year earnings, Best Buy stock looks like a buy to me.

Rich Smith has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Best Buy. The Motley Fool has a disclosure policy.

Synopsys (NASDAQ: SNPS) stock, which makes design and simulation software for pre-production work on semiconductors, soared 10.2% through 11 a.m. ET Thursday after beating analyst forecasts for fiscal Q3 sales and earnings last night.

Heading into the report, Wall Street had Synopsys pegged for $3.67 per share in pro forma profit on sales of just over $2.4 billion. Synopsys actually earned $3.91 per share on sales just under $2.5 billion.

Image source: Getty Images.

Synopsys Q3 earnings

Synopsys had a terrific Q3, with sales up 42.5% year over year and GAAP earnings twice that -- 89% -- to $2.84 per share. (The company's $3.67 number, remember, was non-GAAP.) CEO Sassine Ghazi observed that "AI is driving unprecedented complexity" in the design of new chips, increasing the need for Synopsys's software and contributing to revenue growth that exceeded even the high end of Synopsys's previous guidance.

Free cash flow is doing even better. Year to date, Synopsys has generated more than $2.1 billion in positive cash profits, which is more than three times the company's reported GAAP profit.

What's next for Synopsys stock?

Turning to guidance, management predicts Q4 sales slightly above Street targets, approaching $2.6 billion, with GAAP earnings per share ranging from $0.60 to $0.85.

Full-year sales should similarly surpass Street estimates, and could exceed $9.7 billion. GAAP profits for the year could be as high as $4.08, and non-GAAP earnings will almost certainly exceed $15 per share!

Given the wide divergence between GAAP and non-GAAP "earnings," investors may want to focus on the less malleable metric of free cash flow. With $2.1 billion to-date, Synopsys is on course to generate $2.6 billion through year-end. This gives Synopsys a price-to-free cash flow ratio of 33.3.

Expensive? Sure. But a company growing as fast as Synopsys may be worth it.

Rich Smith has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Synopsys. The Motley Fool has a disclosure policy.

Palo Alto Networks (NASDAQ: PANW) stock jumped 11.1% through 10:05 a.m. ET Thursday on rumors the cybersecurity giant is shifting decisively into acquisition mode.

As StreetInsider.com reported yesterday, Palo Alto Networks spent much of the past two years trying to acquire cybersecurity rivals Okta and Datadog. Rebuffed on both counts, Palo Alto has moved on in search of easier targets -- and may have already found two of them.

Image source: Getty Images.

Palo Alto on the hunt for value

Palo Alto tried to acquire its last two targets on the cheap, offering $13.5 billion for Okta (now worth $23 billion) and $40 billion for Datadog (now worth $80 billion). Management wouldn't bite at either company, but Palo Alto was undeterred.

Was Palo Alto "penny-wise and pound-foolish" in refusing to up its bids on its last two targets, considering how much their stocks have gone up since? Perhaps. Another way to look at this is that Palo Alto management is being exceptionally careful not to overpay for its acquisitions.

That's a good trait for management to have, from an investor's perspective.

What's next for Palo Alto stock?

It's especially helpful to keep this in mind as Palo Alto begins "circling [its] next targets," as StreetInsider puts it: Cribl and ClickHouse.

Artificial intelligence and telemetry company Cribl describes itself as having $200 million in annual recurring revenue, growing at 70% -- and valued at $3.5 billion. ClickHouse is another AI-powered cyber company that says it has more than $250 million in ARR and a $15 billion private market value.

Of the two, Cribl is the only one that costs less than Palo Alto's own 23.6x price-to-sales ratio. It's the closest thing to a bargain for Palo Alto to scoop up -- and possibly next on its shopping list.

Rich Smith has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Datadog and Okta. The Motley Fool recommends Palo Alto Networks. The Motley Fool has a disclosure policy.

Intuit (NASDAQ: INTU) stock fell 4% through 10:50 a.m. ET Wednesday despite reporting strong Q4 and full-year fiscal 2026 earnings last night.

Analysts expected Intuit to earn $3.59 per share for fiscal Q4 on sales under $4.3 billion. In fact, Intuit earned $4.03 per share (adjusted for one-time items) on sales over $4.3 billion. Guidance, however, was weaker than expected -- sparking a sell-off.

Image source: Getty Images.

Intuit Q4 earnings

Intuit finished fiscal 2026 with a bang, growing revenue 14% in both Q4 and the full year. Fiscal 2026 revenue ended up at $21.4 billion, with GAAP earnings of $16.46 per share -- up 20% year over year. (Non-GAAP profits were $24.27 per share.)

Problem was, Intuit then shifted from reporting its strong 2026 results, to telling investors how it expects 2027 to play out. In the first quarter of the new fiscal year, Intuit is looking for sales growth to slow to 11% (about $4.3 billion in revenue), with GAAP earnings between $1.71 and $1.75 per share.

Worse, growth will continue slowing as the year progresses. By the time 2027 wraps up, Intuit forecasts sales growth of only 9% or 10% (about $23.4 billion), with GAAP earnings ranging from $20.12 to $20.36 per share.

What's next for Intuit stock?

But are these numbers really bad enough to justify today's sell-off? I don't think so.

Valued on trailing earnings, Intuit today trades for a price-to-earnings ratio of less than 22x. Granted, the slowing sales growth next year sounds concerning, but Intuit is still promising earnings growth of 22% to 24%. That's a PEG ratio of less than 1.0, which should be good enough for most value investors.

As soon as investors realize this, I expect Intuit's stock to resume rising again.

Rich Smith has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Intuit. The Motley Fool has a disclosure policy.

Oracle (NYSE: ORCL) stock jumped 4.5% through 9:50 a.m. ET Wednesday, and you can thank Citigroup for that.

In a note covered on StreetInsider.com this morning, Citi argues that "one of the most extreme dislocations and drawdowns in the stock's history" has made Oracle stock a buy.

Image source: Oracle.

Oracle's got problems

From June peak to July trough, Oracle stock fell 54% as investors panicked over the massive spending (and debt) commitments Oracle has undertaken to build artificial intelligence infrastructure for clients such as Microsoft and Open AI.

These are valid concerns. In five years, Oracle has grown its debt load 60%, even as its free cash flow production swung from positive $13.8 billion to negative $23.7 billion. And the burning of cash isn't over yet. Analysts polled by S&P Global Market Intelligence forecast that the next two years will see Oracle burn another $90 billion.

Why Citi loves Oracle stock

Regardless, Citi thinks the bad news for Oracle is well and truly baked into the stock price at this point. Demand for AI services is "insatiable," says the banker, and the $85 billion in backlogged work Oracle has amassed is nearly enough to cover its cash needs. By 2030, the banker estimates Oracle's current GAAP profits could triple or even quadruple, delivering per-share earnings of $22 that year.

Assuming Oracle survives the next couple of years of cash burn to reach that point, Citi believes today's prices offer an "historic" opportunity to buy low and sell high later. (Citi estimates the stock could be worth as much as $330 per share.)

With Oracle stock trading for a price-to-earnings ratio of less than 25, and growth estimated at 27% annually over the next five years, Citi might even be right about that.

Citigroup is an advertising partner of Motley Fool Money. Rich Smith has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Microsoft and Oracle. The Motley Fool has a disclosure policy.

Richtech Robotics (NASDAQ: RR) stock soared 17% through 12:45 p.m. ET on Tuesday after announcing plans to buy back $12 million worth of stock.

Shares of the Las Vegas-based robotics company fell 35% in the first half of this year. You and I might view that as a disaster -- but Richtech sees it as an opportunity to scoop up some shares on the cheap, and concentrate future profits among fewer shares outstanding.

Image source: Getty Images.

Disaster or opportunity?

As its name suggests, Richtech builds robots -- Matradee robots for the restaurant industry, ADAM and Scorpion bartending robots, Titan heavy-duty autonomous delivery robots, and Dex industrial humanoid robots, too.

It's a business with plenty of potential in a world where so many countries are experiencing negative population growth, and may need artificial labor to prop up their economies going forward. But Richtech is still a start-up, with start-up-like numbers: revenues in the single-digit millions, negative earnings, negative free cash flow, and a market capitalization of less than $400 million.

Investing in a stock like this is always an exercise in speculation, but Richtech seems happy to bet on itself today.

Should you bet on Richtech?

Is it a good bet? Wall Street isn't convinced. Only one analyst follows Richtech so far -- with a "hold" rating according to data from S&P Global Market Intelligence. Most investors aren't, either. (Witness Richtech's steadily declining stock price up until today!)

Still, S&P estimates see Richtech doubling its revenue over the next couple years, and losses steadily falling. If this is the way things play out, the stock could be a winner. With Richtech stock valued at only $365 million, and nearly that much cash on hand, the worst I can say is there seems little risk left in the stock today.

Rich Smith has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

Sandisk (NASDAQ: SNDK) stock got off to a great start Tuesday, bouncing back nearly 5% after yesterday's China-inspired sell-off -- but it didn't last.

Shares of the NAND flash memory-maker reversed course later in the morning, even dipping into the red. As of 12:05 p.m. ET, Sandisk stock is still up from yesterday's close -- but only 1%.

What's worrying Sandisk investors today?

One imagines the stock is still being dogged by worries that, to mitigate the effects of global memory shortage, the Trump Administration will permit Apple -- and potentially others -- to purchase memory chips from Chinese suppliers ChangXin Memory Technologies (CXMT) and Yangtze Memory Technologies Corp (YMTC).

CXMT recently conducted an IPO in Shanghai that added $8.6 billion to its war chest amid plans to increase production of DRAM chips and begin producing high-bandwidth memory for the artificial intelligence market. And while CXMT doesn't compete directly with Sandisk (CXMT makes DRAM, while Sandisk makes NAND), YMTC does -- because YMTC is a NAND specialist.

And YMTC has also filed for an IPO that could raise billions in new cash.

Wall Street's getting nervous

Perhaps recognizing this threat, Japanese investment bank Mizuho this morning cut price targets "across the semiconductor space citing multiple compression," as TheFly.com reports.

Memory demand is still increasing, and so Mizuho didn't cut its estimate for Sandisk by much, really just tweaking it down from $1,900 to $1,875. But the fact that Mizuho chose to lower its estimate at all in the face of still-rising demand feels like a signal that Wall Street is starting to take a more cautious stance.

Sandisk stock may look cheap at 20x earnings, with Wall Street forecasting 40% annual earnings growth over the next five years. If analysts start cutting growth estimates, though, look out below.

Rich Smith has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Apple. The Motley Fool has a disclosure policy.

Academy Sports and Outdoors (NASDAQ: ASO) stock slipped 3.3% through 10:20 a.m. ET Tuesday -- and it's all Dick's Sporting Goods' (NYSE: DKS) fault!

Dick's reported Q2 earnings results this morning, missing on both earnings and sales, then guiding investors to expect further misses throughout the year. Think that might make investors in other sporting goods retailers just the tiniest bit nervous?

Well, it did, and that's why Academy Sports stock is down today on no news of its own.

Image source: Getty Images.

Dick's Q2 earnings

Dick's reported a $3.50 per share GAAP profit on sales of less than $5.6 billion. Sales surged 53% year over year, but profits plunged 26%, despite Dick's absorbing rival Foot Locker's business and benefiting from its revenue stream.

Worse, management guided investors to expect sales weaker than analysts' expected $22.4 billion (Dick's is promising at most $22.2 billion), and earnings potentially as low as $11 per share -- well below the consensus estimate of $14.20 per share.

What this means for Academy Sports stock

Now here's the good news: Academy Sports is not Dick's Sporting Goods.

Don't get me wrong: if sporting goods sales weaken across the industry, that's going to hurt Academy Sports just as much as it hurts Dick's. The thing is, though, these two stocks are not starting from the same place.

Dick's shares cost nearly 18 times earnings -- even after today's massive sell-off. Academy Sports stock, in contrast, trades at more than a 50% discount to Dick's -- at just 8.2 times earnings. What's more, analysts forecast that Academy can grow its earnings more than 11% annually over the next five years, versus just an 8% projection for Dick's.

Academy Sports stock is cheaper than Dick's. It's growing faster. That makes Academy Sports stock a much better bargain.

Rich Smith has no position in any of the stocks mentioned. The Motley Fool recommends Academy Sports And Outdoors. The Motley Fool has a disclosure policy.

Dick's Sporting Goods (NYSE: DKS) stock crashed 23% in the first 15 minutes of trading Tuesday after reporting an earnings miss this morning.

Analysts expected Dick's to earn $3.78 per share on $5.65 billion in sales for Q2 2026, but the sports equipment retailer reported a profit of only $3.53 per share, and sales came in just under $5.6 billion.

Image source: Getty Images.

Dick's Q2 earnings

And that was the good news. The bad news is that "$3.53" per share was only Dick's non-GAAP earnings number; actual earnings calculated under generally accepted accounting principles (GAAP) were a bit worse at $3.50 per share -- down 26% from one year ago.

Dick's did note that its earnings were affected by the issuance of 9.6 million shares in connection with its acquisition of Foot Locker, which grew the share count to 90.1 million, diluting earnings among more shares outstanding. Still, dilution accounted for only about 11% of the earnings decline.

The rest is on Dick's.

What's next for Dick's stock?

Not all Dick's news was bad. Same-store sales grew a respectable 4.9%, and the addition of Foot Locker's revenue stream helped to grow the company's total sales by 53%. Still, 53% sales growth translating into a 26% decline in profits is a bad look for Dick's.

Turning to guidance, we find a second reason for investors to be upset with the retailer today. Wall Street expected Dick's to earn $14.20 per share this year on sales of $22.4 billion, but the most management promised in its guidance today was $11 to $12 per share in profit -- and no more than $22.2 billion in sales (and potentially even less).

Between the earnings miss and the weak guidance, it's no wonder investors are upset with Dick's stock today.

Rich Smith has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

A funny thing happened when Space Exploration Technologies (NASDAQ: SPCX) reported earnings this month. First, SpaceX declined 13.6% despite beats on both earnings per share and sales for the company. SpaceX lost only $0.09 per share in the quarter, where Wall Street had predicted a $0.29-per-share loss. Sales of $7.8 billion eclipsed forecasts by $1 billion.

Potentially worse news for investors, the earnings announcement triggered a "lock-up" expiration, permitting SpaceX insiders to sell 20% of their stock. A second lock-up expires later this week, when SpaceX passes the 70-days-after-IPO mark, allowing another 7% of the stock to be sold.

But instead of continuing to fall, SpaceX stock did a U-turn. It recovered all its losses and by Wednesday's close was back above its IPO price and trading for $140 a share.

And one Wall Street analyst thinks this is only the beginning of the rally for SpaceX stock.

Image source: The Motley Fool.

Morgan Stanley loves SpaceX stock

SpaceX today carries a market capitalization of $1.9 trillion. It has no profit to back up that valuation, granted, thanks to an artificial intelligence division that's losing more than $1 billion per quarter -- and burning through tens of billions of dollars per year.

But that doesn't scare Morgan Stanley one bit.

In a note released last week, MS analyst Adam Jonas argues that SpaceX's non-AI businesses alone support nearly all of the present value of SpaceX stock, based on a combination of forecast sales and "earnings before interest, taxes, depreciation, and amortization" (EBITDA). To hear Jonas tell it, SpaceX AI comes basically free of charge on top of what investors are already paying for the rest of SpaceX.

Valuing SpaceX as a sum of its parts

Here's how the math works.

Over the past 12 months, the Space and Connectivity divisions of SpaceX -- essentially, everything not AI -- generated a combined $17.9 billion in sales and $8.6 billion in EBITDA, according to data from S&P Global Market Intelligence. AI generated $5.1 billion in sales, but negative EBITDA of $313 million.

Jonas, however, foresees incredible growth for SpaceX over the next couple of years, in Space and Connectivity, and especially in AI.

The analyst calculates that earnings from Space and Connectivity justify the first $127 of SpaceX's current $140 share price -- so 91% of the stock's total market cap. Valuing the stock at 52 times 2028 EBITDA, and reverse-engineering Jonas' math, implies a forecast of $31.5 billion in EBITDA for Space and Connectivity in 2028 -- a 266% increase in just two years.

Meanwhile, consensus estimates on Wall Street have SpaceX as a whole generating $126.8 billion in EBITDA in 2028. Backing out the $31.5 billion contribution from Space and Connectivity, the AI division flips from a loss today to a $95.3 billion EBITDA profit just two years from now.

How to value SpaceXAI

This is a bold prediction. Assuming these estimates are correct, investors are valuing Space and Connectivity EBITDA at a 52 multiple. But they're valuing EBITDA from AI at an ultralow 1.7, giving this division a standalone market capitalization of just $162 billion.

What's more, they're doing this even though -- again, assuming Jonas' numbers are right -- SpaceX's AI division will be growing not just sales but profit many times faster than its Space and Connectivity divisions are growing.

Is that fair? Are investors assigning the "right" price to SpaceX AI?

Well, $162 billion might seem like a fair price to pay for an AI business currently generating negative EBITDA. It might even seem generous. But if two years of hypergrowth grow SpaceX's AI division to the point that it's generating 75% of SpaceX's profit, you'd expect investors would happily pay a much higher price for it. Accordingly, Jonas argues that SpaceX stock, which costs $140 today, could easily reach $300 per share within one year -- and potentially hit $600 in a bull-case scenario.

I remain skeptical. With all due respect to Jonas, I'm going to wait and see SpaceX's AI division prove that it can earn any profit at all before engaging in speculation about how fast it can grow its profit. Still, the possibility is intriguing.

If Jonas' estimates bear fruit, SpaceX stock could be a screaming buy.

Rich Smith has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

The Direxion Daily Semiconductor Bull 3X Shares ETF (NYSEMKT: SOXL) is a momentum back -- but its momentum is moving in the wrong direction today.

This ETF, which takes the performance of semiconductor stocks as a whole and multiplies it -- up or down -- by 3x, soared 32% in the first two weeks of August, but then turned tail today and dropped 8% through 12:12 p.m. ET.

And why?

Image source: Getty Images.

China challenges Micron and Sandisk

Because China, that's why.

As tech website WCCTech reports, the Trump Administration will permit Apple to purchase memory chips from Chinese suppliers ChangXin Memory Technologies (CXMT) and Yangtze Memory Technologies Corp (YMTC). CXMT makes DRAM memory and is working to produce stacked DRAM, known as high-bandwidth memory (HBM), for use in artificial intelligence. YMTC produces NAND flash memory -- also used in AI.

This decision poses a direct threat to two of America's biggest memory chip companies, Sandisk, which manufactures NAND flash memory, and Micron, which manufactures both NAND and DRAM. Adding injury to insult, CXMT recently raised billions in new cash to compete with Micron -- and YMTC will soon follow suit.

What this means for the Direxion Daily Semiconductor Bull 3X Shares ETF

The threat to Micron is most relevant to investors in the Direxion Daily Semiconductor Bull 3X Shares ETF, because Micron is the SOXL ETF's biggest holding -- 8.6%.

Now, the good news is that Micron stock is only down about 5% today, and less than Sandisk (about 6%). The bad news is that other SOXL holdings such as AMD and Nvidia -- SOXL's Nos. 2 and 3 biggest -- are also in the red.

That's the risk you get investing in heavily leveraged tech ETFs like SOXL. When semiconductor stocks are hot, SOXL is even hotter. But when the semis cool down, SOXL goes ice-cold.

Like today.

Rich Smith has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Advanced Micro Devices, Apple, Micron Technology, and Nvidia. The Motley Fool has a disclosure policy.

Sandisk (NASDAQ: SNDK) stock sank 7.5% through 11:40 a.m. ET Monday after tech website WCCTech reported the Trump Administration will permit Apple to purchase memory chips from Chinese suppliers ChangXin Memory Technologies (CXMT) and Yangtze Memory Technologies Corp (YMTC).

Image source: Getty Images.

Missed Nvidia in 2009? This Rare Signal Is Flashing Again. In 2009, a "Double Down" signal flashed for a little-known chipmaker called Nvidia. For the first time in years, that same "Total Conviction" signal is flashing for a company 1/100th the size of Nvidia. Continue »

What does this have to do with Sandisk?

Only one of the two Chinese companies -- YMTC -- competes directly with Sandisk in the manufacture of NAND memory chips. (CXMT focuses on making DRAM chips... for now.)

Nevertheless, because Sandisk has pioneered the use of stacked NAND chips to produce "high bandwidth flash" memory (HBF) as an alternative to DRAM-based "high-bandwidth memory" (HBM), it's basically correct to interpret both YMTC and CXMT as competitive threats to Sandisk because Sandisk's HBF will effectively compete with CXMT's HBM -- which that company plans to begin producing.

On the plus side (for Sandisk), according to WCCTech, the DRAM and NAND that Apple might source from China would only be used in Apple products sold in China -- so for now, the threat to Sandisk is more China-centered than global.

What's next for Sandisk stock?

That's the situation today -- but it may not remain the situation for long. Neither YMTC nor CXMT pose serious threats to Sandisk yet, as Lynx Equity Research analyst KC Rajkumar argues, because Apple has not certified many of their products as of high enough quality for its devices -- nor do they have the production capacity to significantly challenge Sandisk.

CXMT, however, raised $8.6 billion in a Shanghai IPO -- and plans to put that money to work ramping up production. YMTC has not yet gone public, but has filed for an IPO and hopes to raise $4.9 billion -- money it will use to compete with Sandisk.

Cheap Chinese chips are coming. Sandisk investors should be nervous.

Rich Smith has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Apple. The Motley Fool has a disclosure policy.

Micron (NASDAQ: MU) stock tumbled 5.5% in the first five minutes of trading Monday after tech news site WCCTech reported the Trump Administration has decided to permit Apple (NASDAQ: AAPL) to purchase memory chips from Chinese suppliers ChangXin Memory Technologies (CXMT) and Yangtze Memory Technologies Corp (YMTC).

Image source: Micron.

Missed Nvidia in 2009? This Rare Signal Is Flashing Again. In 2009, a "Double Down" signal flashed for a little-known chipmaker called Nvidia. For the first time in years, that same "Total Conviction" signal is flashing for a company 1/100th the size of Nvidia. Continue »

What does this have to do with Micron?

Respectively, CXMT is a maker of low-cost DRAM chips, while YMTC manufactures NAND. Micron produces both kinds of memory chips. According to WCCTech, the DRAM and NAND that Apple might source from China would only be used in Apple products sold in China.

As such, this news isn't a global threat to Micron. It is, however, at least a threat to the company's market share in China, and perhaps in other countries to which China might ship Apple products, should those start to filter out.

What's next for Micron stock?

Not everyone thinks it's time to press the panic button. In a note on StreetInsider.com this morning, Lynx Equity Research analyst KC Rajkumar says calls for investors to sell Micron are an "overreaction," citing concerns about the quality of Chinese wares and the inability of CXMT and YMTC to scale production sufficiently to meet Apple's needs.

Lynx may be whistling past the graveyard here, however.

Is it true that Apple hasn't approved many CXMT and YMTC chips for use in Apple devices yet? Is it true they haven't scaled their production to the point they can steal appreciable market share from Micron yet?

Yes, both these things are true. But CXMT just finished raising $8.6 billion in a Shanghai IPO -- and plans to put that money to work immediately by ramping up production. I expect YMTC to follow a similar path.

Cheap Chinese chips are coming. Micron investors should be nervous.

Rich Smith has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Apple and Micron Technology. The Motley Fool has a disclosure policy.

D-Wave Quantum (NASDAQ: QBTS) stock jumped 6.9% through 1:10 p.m. ET Friday after BMO Capital analyst Harsh Kumar initiated coverage of the quantum computing stock with an outperform rating. Considering that Kumar predicted that D-Wave stock would nearly double over the next year, and hit $35, that's not surprising -- but here's something that is surprising: D-Wave rival Rigetti Computing (NASDAQ: RGTI) stock shot up 9.6% today.

And Kumar didn't mention Rigetti at all!

Image source: Getty Images.

Why BMO loves D-Wave Quantum

In his note this morning, Kumar said D-Wave stock is "best positioned in the quantum space to have commercial success" based on its two-pronged approach to quantum computing, which explores both annealing and gate models to reach accurate conclusions.

Now, Kumar may be right about D-Wave being the "best" quantum stock. This wouldn't necessarily make Rigetti a bad quantum stock -- just not quite as good as D-Wave. In that case, while Rigetti stock rising some today on general enthusiasm for quantum stocks might make sense, it makes no sense for Rigetti stock to be going up more than D-Wave!

D-Wave is better than Rigetti stock

Consider, too, that while both companies are unprofitable (and likely to remain so for years), Rigetti is in a more vulnerable financial position than D-Wave in the near term. With only $394 million in cash, Rigetti is likely to run out of cash by 2030, according to analyst forecasts of future cash burn. D-Wave, with a cash war chest of $546 million, probably has enough cash to last through 2031 or so before needing to raise more.

On its own, this may not be the strongest argument for buying D-Wave. ("It's unprofitable and burning cash.") It's certainly an argument for preferring it over Rigetti, however.

Rich Smith has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

D-Wave Quantum (NASDAQ: QBTS) stock jumped 7.2% through 12:15 p.m. ET Friday after BMO Capital analyst Harsh Kumar initiated coverage of the quantum computing stock with an outperform rating.

According to Kumar, this $20 quantum stock could easily hit $35 within a year.

Image source: Getty Images.

Why BMO loves D-Wave Quantum

D-Wave Quantum "is a revolutionary quantum computing company and one of the few in the world that currently has true commercial revenues," argues Kumar. It's also the only quantum company using both annealing and gate model approaches to quantum computing.

Annealing is an approach best suited to solving problems with an enormous number of possible solutions. Qubits begin in quantum superposition, become coupled and potentially entangled, and gradually transition toward classic 0/1 states, aiming to arrive at the lowest possible energy (i.e., the most likely correct) solution. Conversely, gate model quantum computing more closely resembles traditional computing, where algorithms control circuits to find the correct solution.

Kumar believes D-Wave's strategy of exploring both quantum approaches gives it a first-mover advantage in each, and makes D-Wave "best positioned in the quantum space to have commercial success."

What's next for D-Wave Quantum stock

Just don't expect that success to happen instantly -- or even within the easily foreseeable future. D-Wave isn't profitable today, and, as far out as most analysts are willing to project (2030), D-Wave's expected to still be losing money and burning cash.

Sales, on the other hand, are expected to more than 10X over the next four years, passing $444 million in 2030. If that's your measure of success -- D-Wave's business getting bigger as it makes more and more unprofitable sales -- then I guess I'd agree that D-Wave's on course for "commercial success."

I just wouldn't want to own it myself.

Rich Smith has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

X-ray luggage and parcel examiner OSI Systems (NASDAQ: OSIS) stock tumbled 9.9% through 11:40 a.m. ET Friday morning after reporting mixed earnings on Thursday.

Heading into the company's Q4 report, analysts were looking for $3.77 per share in non-GAAP profit on sales of $529.7 million, as TheFly.com reports. Unfortunately, while OSI beat earnings with $3.78 per share in profit, its sales fell far short of expectations, coming in at just $484.1 million.

Image source: Getty Images.

OSI Systems Q4 earnings

That's the good news -- now here's the bad. OSI Systems' Q4 sales declined 4% year over year, and the $3.78 per share it earned were only non-GAAP profits; actual earnings calculated under generally accepted accounting principles (GAAP) were only $3.27 per share, and up only 8% year over year.

For the full year, OSI reported 4% sales growth to $1.8 billion, and only 3% GAAP earnings growth -- $8.95 per share.

What's next for OSI Systems stock

At first glance, these aren't great numbers. OSI stock trades close to $200 per share right now, and its $8.95 per share in full-year earnings works out to a 22x price-to-earnings ratio -- a bit expensive for a company growing earnings at only 3%!

The good news is that free cash flow at OSI looks quite a bit better. In 2026, FCF totaled $245.3 million, resulting in a price-to-free cash flow ratio of just 13.3x. The better news is that in 2027, management forecasts accelerated growth, with sales expected to rise as much as 8% and non-GAAP earnings as much as 11%.

That's still not fast enough growth to justify the valuation in my view, but it's closer to the mark. If OSI stock continues to sink in the wake of earnings, it may become cheap enough to buy.

Rich Smith has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

"Rocket Lab onboarded to U.S. Space Force's $981M NITE-STAR Program to advance space test and training infrastructure," blared the headline Monday evening. Managed by the U.S. Space Force's Space Systems Command, the announcement proceeded to explain, NITE-STAR will "support a distributed test and training architecture to help prepare space operators for contested scenarios." Fast-growing space company Rocket Lab (NASDAQ: RKLB) will participate in the program -- and potentially win up to $981 million in contracts.

Good news for Rocket Lab?

Yes, but... the devil's in the details.

Image source: Rocket Lab.

What we know about NITE-STAR

Someone worked late nights to come up with the NITE-STAR acronym, which, in full, reads as the "NSTTC Innovative Technology & Engineering – Space Test and Range" program. Announcing its participation, Rocket Lab explained that NITE-STAR will develop "distributed test and training architecture to help prepare space operators for contested scenarios."

Translated from Pentagon-speak, that appears to mean NITE-STAR is a wargames program that will allow Space Force Guardians (that's the official name for servicemen and servicewomen in this military branch) to train for and practice military operations in space. Participating in this near-billion-dollar program holds promise for Rocket Lab. What you may not know, however, is that Rocket Lab is only one of several defense companies working on NITE-STAR.

What you also may not know is that the actual value to Rocket Lab will probably be a whole lot less than $981 million.

NITE-STAR by the numbers

NITE-STAR first appeared in a March announcement on GovConWire.com seeking requests for proposals (RFPs) to build the architecture. Winners were announced on the Department of Defense website late last month.

And that's where we find the details of this contract.

Two stand out. First, the NITE-STAR program will last 10 years (so the $981 million contract ceiling must be divided by 10 to determine how much will actually be paid out annually). Second, Rocket Lab is only one of 15 companies allowed to bid for task orders under the contract. (Other winners include such big space names as Lockheed Martin, Northrop Grumman, and Viasat.)

So take that number that you already divided by 10, and divide it again -- this time by 15.

The result of all this dividing is that, on average, investors can expect each winner of a NITE-STAR task order to collect about $6.5 million per year over the contract term.

What it means to Rocket Lab investors

That number -- $6.5 million -- is, of course, a whole lot less impressive number than $981 million, so you can understand why Rocket Lab accentuated the more positive number in its press release. Still, the upshot for Rocket Lab investors is that, while their company may win some funds from NITE-STAR, it probably won't be enough to move the needle.

With Rocket Lab currently pulling in nearly $770 million annually, the near-billion-dollar NITE-STAR contract will likely add less than 1% to the company's revenue. It's better than nothing -- but it's not enough to turn Rocket Lab stock -- which trades at more than 60 times sales and is unprofitable -- into a buy.

Sorry to be the bearer of bad news.

Rich Smith has positions in Rocket Lab. The Motley Fool has positions in and recommends Rocket Lab. The Motley Fool has a disclosure policy.

Lockheed Martin (NYSE: LMT) stock slipped 2.7% through 1:50 p.m. ET Thursday -- but here's the strange thing:

Lockheed stock is down not on bad news, but after making an actually positive announcement.

Image source: Getty Images.

Lockheed Martin does maritime drones

As StreetInsider.com reports today, Lockheed Martin just finished up demonstrating a partnership with privately held drone company Saildrone at the RIMPAC (Exercise Rim of the Pacific) 2026 naval exercises. In this demonstration, a Saildrone Surveyor craft was used to remotely fire Lockheed-built Joint-Air-to-Ground Missiles (JAGMs) at a mock high-speed motorboat target.

The Surveyor was also tested, demonstrating the use of threat-identification radar systems and electronic warfare systems that can be used to combat hostile drones.

What it means for Lockheed Martin

The largest pure-play defense stock in the world, Lockheed Martin is best known for building military aircraft and missile systems -- not naval vessels, and certainly not drone boats. (Indeed, Lockheed's overall maritime history can be charitably described as checkered, given its involvement in the much maligned and essentially canceled Littoral Combat Ship program!)

In partnership with Saildrone, however, Lockheed is finding a backdoor into Navy sales (pun intended) by putting its weapons on drone boats built by a partner. Going forward, Lockheed and Saildrone intend to expand their collaboration, including by using larger Saildrone Spectre-class vessels to carry larger containerized weapons systems such as Lockheed's Mk 70 vertical missile launchers and SURTASS Towed Array sonar systems for antisubmarine warfare.

Can such small experiments grow, evolve, and "move the needle" on Lockheed Martin's $77 billion annual revenue stream over time? Maybe yes, maybe no. Simply expanding the company's market for its products, however, makes this news a reason for Lockheed Martin stock to be going up today.

It certainly shouldn't be going down.

Rich Smith has no position in any of the stocks mentioned. The Motley Fool recommends Lockheed Martin. The Motley Fool has a disclosure policy.

Shares of car parts retailer Autozone (NYSE: AZO) slipped 4.4% through 12:25 p.m. ET Thursday after its smaller rival Advance Auto Parts (NYSE: AAP) reported stronger-than-expected earnings -- but missed on sales and issued weak guidance this morning.

Image source: Getty Images.

Missed Nvidia in 2009? This Rare Signal Is Flashing Again. In 2009, a "Double Down" signal flashed for a little-known chipmaker called Nvidia. For the first time in years, that same "Total Conviction" signal is flashing for a company 1/100th the size of Nvidia. Continue »

What Advance Auto Parts said

Analysts expected Advance Auto Parts to earn $0.81 per share in the quarter, and it beat that number, reporting a $1.03 per share profit. Problem was, Advance's $2 billion in sales fell just short of expectations for $2.04 billion.

Worse, Advance said full-year sales missed Wall Street's $8.6 billion forecast. And now investors are wondering if this means Autozone, too, might have bad news to report when its own earnings come out next month. (Sept. 22, to be precise.)

What's next for Autozone

After all, according to a running tally kept by Yahoo! Finance, Advance Auto Parts had been on something of a roll, beating earnings forecasts seven straight quarters in a row (including this one), versus just two wins in a row for Autozone. If something has happened to break Advance's winning streak, it's logical to worry that the same might hold true for Autozone.

And yet, I would not worry.

Why not? Well, for one thing, the $8.53 billion in sales Advance is forecasting for fiscal 2026 isn't too far off from the $8.58 billion that Wall Street was looking for, for one thing. Also, Advance reaffirmed that things are going basically according to plan this year -- which suggests the same might hold true for Autozone.

Speaking of which, at a valuation of only 21.1 times earnings, Autozone already looks like a better bargain than Advance stock, which costs nearly 51 times earnings. If I had to own only one auto parts stock, I'd pick Autozone over Advance.

Rich Smith has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

Redwire Corporation (NYSE: RDW) had a terrific Q2 -- or at least, investors viewed it that way.

Redwire beat sales expectations, reporting $117 million for the quarter earlier this month. Losses were less than expected at only $0.09 per share. Investors cheered -- and shares of the space infrastructure-and-terrestrial drones company soared past $13 a share the day after earnings were released, a one-day gain of nearly 15%.

They've mostly stayed above $13 since that Aug. 5 earnings report, but briefly dipped below that level on Tuesday. Today, the stock is down 7.3% (as of 12:15 p.m.). And now the question for investors is: Should you buy Redwire stock while it's still below $13?

Image created by JesterAI.

Redwire stock is a rocket

The sales and earnings news for last quarter was only the beginning, too. Proceeding through its report, Redwire described how it flipped from negative gross profit margins a year ago to positive 27.8% this time, and how it added 42% more money entering its backlog as new orders, than exited as revenue -- a book-to-bill ratio of 1.42. And how its backlog of work to be done now stands at $542 million.

That's more than 15 months' work all lined up and ready to be done, at the company's current annual revenue rate of $426 million.

Between the rising backlog and the accelerating rate of new orders, Redwire anticipates growing its sales by up to 49% this year, to perhaps $500 million.

How to value Redwire stock

That's the good news.

The bad news is that analysts polled by S&P Global Market Intelligence think Redwire will need to reach closer to $700 million before it has a chance of becoming profitable. Long-ish range forecasts see the company approaching that mark in 2028, with about $685 million in sales -- but still $10 million in losses. So Redwire will probably have to exceed $700 million in revenue before it reaches breakeven profit under GAAP.

Until that happens, investors won't be able to value Redwire on price-to-earnings, and will have to make do with price-to-sales ratios.

This, unfortunately, is the other bad news. Currently priced at $3.35 billion in market capitalization, Redwire stock sells for 7.9 times trailing sales and 6.7 times its own best estimate of current-year sales. The stock furthermore costs nearly 5 times the sales that analysts forecast for it in 2028 -- two years from now.

All of these valuations, unfortunately, remain well above the 2x-4x sales valuation that investors have historically paid for not-yet-profitable space start-ups like Redwire. For this reason, I continue to view Redwire stock as overvalued.

Tempting as it may be to buy Redwire now that its stock has fallen below $13, I'd need to see it drop to $8 or below before I'd be interested in buying.

Rich Smith has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

Shares of silicon carbide power module-maker Wolfspeed (NYSE: WOLF) tumbled 15.2% through 11:40 a.m. ET Thursday after missing badly on its earnings report last night.

Heading into its fiscal Q4 2026 report, analysts already weren't optimistic, expecting Wolfspeed to lose $0.52 per share on sales of $223.6 million, but the news was actually much worse. Wolfspeed lost $2.26 per share -- four times as bad as expected -- and its sales were only $149.6 million.

Image created by JesterAI.

Wolfspeed Q4 earnings

Revenue plunged 24% year over year, with negative gross profit margins "earned" on those sales. (In fact, the negativity of the margin increased to 25%, meaning for every $1 in sales Wolfspeed booked, it lost $1.25 --before subtracting operating costs).

The good news is that this was a better result than Wolfspeed booked a year ago. The bad news is that it still left Wolfspeed with a big net loss -- actually $2.81 per share when calculated under generally accepted accounting principles (GAAP), worse than the pro forma loss of $2.26.

What's next for Wolfspeed

Wolfspeed is betting on the artificial intelligence revolution to turn its fortunes around, noting that "AI data center revenue more than doubled year-over-year" for all of fiscal 2026, and gained strength as the year progressed, growing 20% sequentially in Q4. Management's guidance for about $150 million in revenue in fiscal Q1 2027, however, is almost exactly flat against Q4 2026 results -- suggesting that this acceleration has now stopped cold.

Indeed, analysts who follow the stock think this year's revenue will be even worse than last year's -- which were worse than the year for that, which were worse than the year before that, which were worse than the year before that!

Things aren't looking great for investors in Wolfspeed. Selling today might be the right call.

Rich Smith has no position in any of the stocks mentioned. The Motley Fool recommends Wolfspeed. The Motley Fool has a disclosure policy.

Cosmetics company Coty (NYSE: COTY), which sells under such well-known brand names as CoverGirl, Jovan, Max Factor, and Nautica, tumbled 10% through 10:10 a.m. ET Thursday after missing on earnings last night.

Heading into its fiscal Q4 2026 report, analysts expected Coty to lose $0.01 per share on just under $1.2 billion in sales for the quarter. In fact, Coty lost $0.02 per share despite sales approaching $1.3 billion.

Image source: Getty Images.

Coty Q4 earnings

Coty observed that its results exceeded expectations despite sales growing only 1%. (Curiously, the beauty brand blamed "the Middle East conflict" for weak sales in the quarter.)

CEO Markus Strobel also pointed to "sales and profit ahead of our targets," and "growing free cash flow" as bright spots. And yet, the company's 1% sales growth rate and total lack of profits -- Coty actually lost $0.16 per share when earnings are calculated under generally accepted accounting principles (GAAP), twice as bad as last year's Q4 loss of $0.08 per share -- suggest the quarter was actually quite weak for Coty.

What's next for Coty

Coty is working to right the ship, however. It's trying to up "the visibility and recommendation of our brands across AI platforms," for example, leaning into the AI revolution. In an effort to work down its debt load -- $3.4 billion on a company with a market capitalization of only $2.7 billion -- Coty sold its stake in Wella for $750 million last year, and sold its Gucci Beauty license back to the owner for $400 million in July.

Heading into the "transition year" that fiscal 2027 will be, Coty aims to refocus on its core brands and continue paying down debt. With $300 million in positive free cash flow expected in the year's first half -- nearly as much as Coty made in all of fiscal 2026 -- it's on the right track to do that.

Rich Smith has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.