Shares in Rocket Lab (RKLB) climbed on Friday after receiving a stock forecast upgrade, as well as signing a new defense contract. The company announced a $816 million Space Development Agency (SDA) Tranche 3 Tracking Layer contract, marking the largest single award in Rocket Lab’s history. The contract includes 18 satellites equipped with advanced missile warning and tracking sensors.

Analysts noted the award positions Rocket Lab as a prime contractor for future projects, including the Golden Dome program, potentially supporting long-term revenue growth. Other market observers cautioned that the stock’s valuation remains elevated and highlighted insider selling, suggesting short-term gains may be moderate.

Additionally, the space launch services provider received an upgrade from Morgan Stanley, helping pump shares higher. The firm on Friday upgraded Rocket Lab (RKLB) to overweight from equal weight. Morgan Stanley also introduced an “attractive industry view” on the space technology sector for 2026, noting that the favorable trends that drove 2025 outperformance should carry into this year. Morgan Stanley went on to raise its price target on Rocket Lab to $105 from $67.

Furthermore, Rocket Lab has also maintained momentum through repeated successful Electron launches and steady progress on its Neutron launch vehicle, reinforcing investor confidence. The space sector is witnessing robust growth, driven by policy support and increased launch activities, benefiting companies like Rocket Lab. That growth is expected to continue in 2026, led by companies like RKLB and SpaceX.

Outside of Morgan Stanley, other Wall Street firms are more mixed in their outlook for Rocket Lab RKLB stock. Needham is issuing a Buy rating and a price target of $90, while Cantor Fitzgerald remains Overweight but suggests a lower target of $54. These all imply the stock’s current $97 price dipping dramatically throughout the rest of 2026.