This play on the booming space economy could more than triple, says Roth MKM


Roth MKM believes that Redwire’s shares are about to take off. Suji Deilva, managing director of Roth MKM, initiated research coverage on the space stock by giving it a buy rating. His $10 price target suggests that the stock could surge 222% in the next year. Desilva stated that RDW’s revenue model based on program contracts provides investors with a high level of visibility and predictability. We estimate that RDW has hundreds of millions in contracted backlog, and several billions of revenue opportunities. Redwire, who went public in 2021 via a special-purpose acquisition company, briefly rose to 2.3% on Wednesday morning, bringing its year-to date advance to 59%. RDW YTD Redwire’s Strong Year Desilva said Redwire had built a “differentiated, highly integrated space product offering”, through acquisitions. The portfolio included products such as communication antennas and power components. The Jacksonville-based company helps to facilitate integrated space missions, promote space exploration, and provide support for multilateral missions. Desilva noted that Redwire’s products and services are aimed at a more reliable, economical infrastructure to support space exploration. It also differentiates itself from other companies by focusing on space-based operations and in-space construction. Redwire’s main customers, civilian and national-security agencies and private businesses, seem to be gaining traction using that platform. Desilva believes that Redwire will now experience steady growth after multiple quarters with organic growth and EBITDA profitability. Cash on hand, as well as additional capital available, can meet short-term working capital requirements. Roth MKM’s $10 share price target reflects an enterprise-value-to-sales multiple of 2.5 times, lower than peers’ 3.0 times owing to Redwire’s early-stage status. Michael Bloom, a CNBC reporter, contributed to this article.