How I Landed a 150% Gain on Intuitive Machines (NASDAQ: LUNR) in Three Months

On June 20, I recommended Intuitive Machines (NASDAQ: LUNR) to my Secret Stock Files subscribers. It was trading for $3.61 a share at the time. And last week, we sold it for $8.91 — netting a 147% gain. 

I’m telling you this now for two reasons…

First, I really like Intuitive Machines. It’s a fun, interesting company, and clearly a good speculative bet. The stock has already regressed from last Wednesday’s massive one-day spike, and if it continues to decline it’d be a good option for space sector speculators to wade back in. 

And that is what we’re talking about here, the space economy — something I’ve been going on about for years now.

The second reason I want to mention it is because it’s a good chance to explore how this kind of a trade comes together from my perspective as an investment analyst. 

So let’s take a closer look at the moonshot play that is Intuitive Machines.

Intuitive Machines and the Space Economy

As I mentioned I’ve been targeting the nascent space economy for the past few years. It’s an exciting field with scores of potential. 

That’s plainly evident, not just with Intuitive Machines, but stocks like AST SpaceMobile (NASDAQ: ASTS), which made an incredible 1,000% move earlier this year.

AST is working to establish itself as a major purveyor of satellite constellations, like Starlink. That’s one major aspect of the space economy.

Intuitive Machines is taking a different approach. It’s looking to exploit a renewed interest in space exploration, specifically to the moon and Mars.

I’m not sure if you’ve noticed but after decades of indifference, governments around the world are suddenly racing back to the moon’s surface. 

China has carried out half a dozen moon missions in the past decade, with more set to come. Increasingly, there are fears China aims to militarize Earth’s solitary satellite along with help from Russia. Meanwhile, India, Japan, and others are looking to establish their own lunar programs in the name of science. 

Then, of course, there’s the United States. After effectively abandoning the Apollo program decades ago, we’ve come to realize that this is a competition with actual stakes. So America’s lunar exploration has been resuscitated. 

On Feb. 22, an American craft touched down on the moon’s surface for the first time since 1972. And for the first time in human history, it was a commercial company — not a government agency — that carried out the mission. 

It was Intuitive Machines. 

That event caused a massive spike in Intuitive Machines’ stock, which soared from a little over $2.00 per share to more than $13. However, the excitement surrounding the company was short-lived. 

For one thing, Intuitive Machines’ success was marred by the fact that its lunar lander tipped over upon making contact with the moon’s surface. And secondly, it’s important to remember that space companies like LUNR are still upstarts and don’t actually make money (yet). 

IM’s first quarter revenue got a generous boost from that February moon mission, surging 300% year over year, to $73 million. However, the company still posted a net loss of $5.4 million.

In the second quarter, IM reported a surprise profit of $0.29 per share — but that was largely the result of one-time items such as warrants. The company’s operating loss for the quarter still totaled $28 million.

Now, the fact that IM regularly loses money shouldn’t necessarily dissuade investors. But it’s also something you have to keep in mind when you’re looking at the company’s share price. 

That is, there’s a reason I bought in after the moon dust had settled in June, as opposed to that parabolic surge in February.

Contracts for moon missions are few and far in between. Most all of LUNR’s business is attributable to NASA at this point. And when a small company burns through cash at the rate IM does, there’s always a risk it could have to issue more shares to recapitalize. 

Again, that’s not disqualifying, but it’s why Intuitive Machines’ stock sees these massive swings in share price. For example, the stock spiked 40% in a single day last week, when NASA awarded the company an incredible $5 billion contract for communications and navigation services related to the Artemis lunar exploration campaign.

That’s a huge deal. And it’s almost certainly set a new floor for Intuitive Machines stock. But right now, it’s not especially clear what the floor is. Once I figure it out, I’ll probably send out another update to Secret Stock Files subscribers and reissue a buy rating. 

Especially since Intuitive Machines expects to carry out its second moon mission on NASA’s behalf in December/January. The success or failure of that mission will have a lot to say about where Intuitive Machines’ stock goes from here. 

It may also see a sell-off in the interim due to profit-taking or even just a bad day for the market. Really, it can’t be said enough that the companies involved in the space economy are small, volatile, and difficult to predict. 

That’s part of the reason there’s such tremendous potential for gains, but those gains require thought, timing, and luck. 

Of course, if you want to get into space stocks and profit from investments like IM then you should check out Secret Stock Files.

I even have another space-economy stock in the portfolio that I think is an even better bet than IM, because it’s already generating significantly more revenue as a nimble, low-cost launch provider and space systems company. 

It’s more than doubled in value since April. 

The bottom line, though, is that both of these stocks illustrate the profit opportunity that’s emerged in the space segment, which is projected to grow from $630 billion in 2023 to $1.8 trillion by 2035.

So keep an eye on LUNR stock, and check out my latest report on how to profit if you haven’t already.