Intuitive Machines Inc. (NASDAQ: LUNR) saw its shares surge approximately 8% on Friday, as Wall Street analysts pivoted attention from the company's second-quarter earnings shortfall to its rapidly expanding order backlog, signaling confidence in its long-term growth trajectory.
The stock climbed to $18.99, extending a rally that has seen gains in 11 of the last 12 sessions and a roughly 62% increase this month. The move followed an upgrade from Stifel, which raised its rating to Buy from Hold, albeit with a reduced price target of $26, down from $32.
Backlog growth takes center stage
Intuitive Machines ended the second quarter with a contracted backlog of nearly $1.8 billion, up approximately $707 million from the prior quarter. A significant portion of this growth came from a $600 million contract to build three commercial geostationary Earth orbit communications satellites.
Stifel analyst Jonathan Siegmann emphasized that the backlog surge outweighs concerns about quarterly financial performance. "It's the backlog surge that is important," he wrote, adding that the backlog is well diversified across civil, commercial, and national security space programs.
Siegmann also argued that investors are overly focused on near-term execution while overlooking improving long-term prospects. "The 2027 outlook is substantially improving. Buy LUNR now while the market stays preoccupied with 2026. LUNR's backlog build is diversifying and accelerating—this is the most important development of the quarter," he stated.
Analysts remain optimistic despite target cuts
Other analysts echoed this sentiment while adjusting their valuation targets. Cantor Fitzgerald lowered its price target to $32 from $43 but maintained an Overweight rating. Analyst Andres Sheppard pointed to the expanding backlog, along with contracts tied to NASA and the Golden Dome missile defense program, as reasons to remain constructive.
The firm also noted that Intuitive Machines reaffirmed its fiscal 2026 revenue guidance of $900 million to $1 billion and maintained expectations for positive adjusted EBITDA. During the quarter, the company secured its sixth lunar mission under NASA's Commercial Lunar Payload Services program and won the AMDT3 Golden Dome contract to design, build, and deliver 18 spacecraft for the Space Development Agency.
Management disclosed that its third lunar mission is now expected to launch in the first quarter of 2027 instead of the fourth quarter of 2026, delaying recognition of roughly 10% of the related contract revenue.
Long-term contracts bolster growth outlook
B. Riley also turned more bullish following the earnings report. Analyst Mike Crawford maintained a Buy rating and raised his price target to $45 from $43. Crawford said the $1.8 billion backlog "highlights growing momentum" as Intuitive Machines "aims to become the next-generation space prime." He added that Thursday's trading reversal reflected investors shifting focus from weaker-than-expected quarterly revenue to the company's expanding pipeline of future business.
Beyond recent awards, Intuitive Machines has been selected under the US Space Force's Andromeda multiple-award contract, which carries an initial value of up to $1.84 billion and a total potential value of up to $6.24 billion across participating companies.
Although analysts do not expect the company to reach profitability this year, its revenue has grown 117% over the past 12 months. Wall Street now appears increasingly focused on whether its expanding contract portfolio can support sustained growth over the coming years.
This article is for informational purposes only and does not constitute financial advice.
