Intuitive Machines (NASDAQ: LUNR), a producer of lunar landing and exploration vehicles, went public on Feb. 14, 2023, by merging with a special purpose acquisition company (SPAC). The combined company’s stock started trading at $10, soared to a record high of $81.99 a week later, but withered to about $2 by the start of 2024.
Like many other SPAC-backed space stocks, Intuitive Machines overpromised and underdelivered. It broadly missed its initial revenue targets after delaying the launch of its Nova-C lander and securing fewer new contracts. Rising interest rates also cast a harsh light on its losses and popped its bubbly valuations.
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But over the past 12 months, Intuitive’s stock nearly quadrupled as it finally achieved its first successful lunar landing, gained new NASA contracts, and expanded its “ride-sharing” service for delivering third-party payloads to the moon.
It might seem prudent to take some profits after that massive rally, but Wall Street remains bullish on its growth prospects. All five analysts who cover Intuitive rate it as a “buy,” with price targets from $15 to $20. Roth MKM, which set the high bar of $20 last month, believes the company can generate steady revenue growth across multiple programs as it gradually gears up for its second moon launch.
So should you buy this stock while it’s still trading around $13?
Intuitive Machines signed three major contracts with NASA in 2021, and it originally planned to launch its first Nova-C lunar lander that same year. However, that launch was repeatedly delayed until February 2024.
That long-awaited launch, which marked the first successful U.S. moon landing since 1972, drove NASA to award Intuitive Machines with a new lunar terrain vehicle (LTV) contract in April, a new commercial lunar payload services (CLPS) contract with NASA in August, and an exclusive five-year near-space network (NSN) contract worth up to $4.8 billion in September. It ended the third quarter of 2024 with a record quarterly backlog of $316.2 million.
Intuitive expects its tightening relationship with NASA, new non-NASA contracts, and the expansion of its commercial ride-sharing business to boost its annual revenue from $80 million in 2023 to $215 million to $235 million in 2024. From 2024 to 2026, analysts expect its revenue to more than double from $228 million to $497 million.
With an enterprise value of $1 billion, Intuitive still looks like a bargain at 4 times this year’s sales and just 2 times its estimated sales for 2026. Analysts also expect its adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) to turn positive in 2025 and jump to $44 million in 2026. As for its balance sheet, Intuitive held nearly $90 million in cash and equivalents with zero debt at the end of the third quarter, and CEO Stephen Altemus said it still had “ample liquidity” for its “blueprint to commercialize the moon” during its latest conference call.
