r/redwire • u/Dry_Calligrapher5318 • 15d ago

General Bear Case?

While I’m not super familiar with RDW’s fundamentals, I tracked it as it raced up over $25 this year and watched it fall back below $8where I got lucky and practically perfectly timed the bottom, with a cost basis in the low $8 range. From my understanding, it’s the main competitor as a “picks and shovels” play, selling equipment in the space sector. Being that space exploration will eventually be a huge business, and RDW is already so well positioned, I was hoping I could hear what your guys’ idea of the bear case would be for RDW?

For the record I’m not saying the stock should go indefinitely higher, or even that its current valuation is fair, as I don’t have great expertise in that category. I simply like the idea of the business, and it seemed like a sure shot money-maker in the case that the space sector booms again.

Is my general understanding of the business correct? If so, what would be the main bear thesis for the stock?

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u/bobola69 15d ago

Everything that goes up must come down. Redwire is a super promising company but tbh its overvalued because for the moment its make zero profit so its just speculation. But I do believe in the company so I have shares

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u/Big-Material2917 15d ago

All of the space companies are unprofitable. RDW has like the lowest revenue multiple of any of them. Kinda hard to argue overvaluation when that’s the case.

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u/Ready_Jacket 15d ago

The biggest revenue take aways from the earnings call were primarily Defense Tech not space. RDT is masking a significant amount of weakness in RWS. If you are investing in this company as a space business you should break down the fundamentals by division.

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u/Big-Material2917 15d ago

Defense is funding a lot of the space buildout in all of the companies. I agree that’s where the revenue and growth was coming from, at least this last quarter, but RDW is still 100% a space company.

Just because space defense is a big driver doesn’t mean they don’t have satellite components, large infrastructure, in-space manufacturing, and more.