The private space race isn't just about who can launch rockets faster—it's about who can win Pentagon contracts. With growing geopolitical tensions and an arms race in space-based defense, Rocket Lab Corp (NASDAQ:RKLB) and Firefly Aerospace Inc (NASDAQ:FLY) are emerging as top contenders, each vying for a piece of a defense-driven future that could reshape the industry.
Defense Ambitions Fuel Competition
While Rocket Lab has long been known for its Electron rocket and ambitious Neutron development, Firefly is pushing hard into the defense sector, recently landing a high-profile U.S. Space Force contract.
These moves are part of a broader shift where space startups aren't simply targeting commercial satellite customers—they're embedding themselves into Washington's defense strategies. The competition reflects how defense budgets, not just private capital, are increasingly shaping the trajectory of space companies.
Read Also: Rocket Lab (RKLB) Stock On Watch As Investors Weigh Recent Acquisition And Launch News
Analyst Sees High Stakes Ahead, Golden Dome Catalyst
JPMorgan's Seth M. Seifman initiated coverage of Firefly with an Overweight rating and a $55 price target, arguing that Firefly's moon landing success, versatile spacecraft, and expanding rocket lineup position it to capitalize on the U.S. government's ambitious space and missile defense push. At $45.37 per share, Firefly trades at a discount to peers like RocketLab, but Seifman says its growth trajectory and Golden Dome exposure make it one to watch.
The Golden Dome initiative, aimed at strengthening U.S. missile defense and space security infrastructure, could be a major catalyst for Firefly.
Morgan Stanley analyst Kristine Liwag has highlighted Rocket Lab's positioning as a frontrunner in the small launch market but cautions that defense partnerships will be key to future growth. Firefly's ability to secure contracts and rapidly iterate its Alpha rocket program has put pressure on Rocket Lab to scale faster, especially with rivals like SpaceX dominating the heavy launch category.
Investors, Liwag suggests, should focus on which company can become indispensable to the Pentagon's growing interest in low-cost, rapid-response space capabilities.
A Two-Horse Race With Global Implications
As defense dollars flow into commercial players, Firefly and Rocket Lab stand to benefit from a changing geopolitical landscape where space superiority is a national security priority. The race is no longer about prestige launches but about reliability, scalability, and government trust.
This defense twist could turn two relatively young companies into pillars of America's space strategy, a dynamic that Wall Street is watching closely.
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Photo: Zakharchuk from Shutterstock
