Firefly Aerospace (FLY) Stock Falls Hard on SpaceX IPO Day — But Analysts Say Buy the Dip

TLDR

• KeyBanc upgraded Firefly Aerospace (FLY) to Overweight from Sector Weight, setting a price target of $135
• The upgrade follows a broad space sector selloff triggered by SpaceX’s IPO debut on Friday
• Firefly was awarded a $75 million MoonFall NASA contract, which drove KeyBanc to raise its FY26 and FY27 revenue estimates
• FLY stock sank 19% on Friday before bouncing back ~5.4% in premarket Monday trading to $33.60
• KeyBanc also upgraded Rocket Lab (RKLB) to Overweight, calling it the “clear” number two space play behind SpaceX

Firefly Aerospace (FLY) stock fell 19% on Friday before recovering in Monday premarket trading, rising around 5.4% to $33.60. The stock currently trades around $31.87, well below KeyBanc’s newly set price target of $135 — implying roughly 57% upside from current levels.

Firefly Aerospace Inc., FLY

The selloff came as SpaceX made its long-awaited IPO debut on Friday. The stock jumped 19% from its IPO price to close at $160.95. But the big debut dragged the rest of the space sector down with it, as funds sold off smaller players to make room for the new heavyweight.

Firefly wasn’t alone. AST SpaceMobile dropped 16%, Intuitive Machines fell 13%, Voyager Technologies slid 14%, and Redwire declined 12%. Rocket Lab lost 11%.

KeyBanc analysts Michael Leshok and Liam Baker called the selloff “unwarranted and largely systematic in nature.” They upgraded both Firefly and Rocket Lab to Overweight from Sector Weight on Sunday, ahead of Monday’s open.

NASA Contract Drives the Upgrade

The upgrade wasn’t just a reaction to the selloff. KeyBanc also pointed to Firefly’s recently awarded $75 million MoonFall NASA contract as a key reason for raising its outlook.

The contract highlights the value of Firefly’s Elytra spacecraft and its positioning within NASA’s lunar base plans. KeyBanc raised its FY26 and FY27 revenue estimates in response.

Firefly has posted 71% revenue growth over the last twelve months. Analysts are forecasting 175% revenue growth for fiscal 2026.

SciTec, a Firefly subsidiary, also recently picked up a $5.5 million contract option from the U.S. Department of the Air Force, part of a larger $24 million deal under the Advanced Battle Management System.

What Comes Next for FLY

Firefly’s Alpha rocket is currently serving the small- to medium-lift market. The company saw a recent launch success with Alpha Flight 07.

Its Eclipse rocket, expected no earlier than 2027, is targeting the medium-lift market — a step up in scale that KeyBanc sees as a potential long-term driver if execution holds.

The launch business is capital intensive and still ramping. Firefly also recently launched a public offering of 12 million shares priced at $48.00, with 4 million offered by the company and 8 million from selling stockholders.

The company holds more cash than debt on its balance sheet despite operating at a loss, according to InvestingPro data.

KeyBanc noted that there are not enough rockets to meet demand, and that satellite appetite continues to fuel space economy growth. The firm favors well-capitalized commercial space companies aligned with national security and NASA priorities.

Rocket Lab received a price target of $50 in Monday’s upgrade, with KeyBanc calling it the “clear” number two space play behind SpaceX. Rocket Lab rose around 4% in premarket trade to $106.48.

SpaceX continued its advance on Monday, gaining more than 5% in premarket trading.

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