Rocket Lab (RKLB) stock gained 1.6% in premarket trading on Thursday after Baird initiated coverage of the stock with a bullish view.

According to TheFly, the brokerage gave the stock an 'Outperform' rating and $83 price target. Baird's price target implies a 19.8% upside compared to the stock's previous closing price.

Baird analysts reportedly said that the company's position as a reliable space launch provider is "firmly established" through its 94% mission success rate. The brokerage noted that the 34% compound annual growth rate for revenue through 2030, as projected by consensus, is supported by the larger Neutron rocket.

The brokerage stated that the development will enable the company to enter the "highly lucrative" medium-lift market, directly competing with SpaceX's Falcon 9 rocket. Earlier this week, Morgan Stanley analysts labeled Rocket Lab as "an earlier-stage alternative to SpaceX," while noting that the firm's new valuation "takes cues" from SpaceX's implied value.

The Neutron rocket is being designed to be more powerful than its Electron rocket, with its first launch targeted for late 2025 or early 2026 from a new dedicated launchpad at Wallops Island, Virginia.

Retail sentiment on Stocktwits about Rocket Lab was in the 'bullish' territory at the time of writing.

Last week, Rocket Lab secured two dedicated launch agreements with the Japan Aerospace Exploration Agency (JAXA). The missions, both set to launch from Rocket Lab's New Zealand-based Launch Complex 1, will support JAXA's Satellite Technology Demonstration Program. The company also signed a multi-launch deal with the Institute for Q-shu Pioneers of Space.

Rocket Lab stock has more than doubled this year.

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