This Stock Could Double Your Money in Just Two Years

You could forgive chief financial officers for being nervous wrecks.

Not only have the vast majority of them personally been in lockdown because of the coronavirus, but their careers are steeped in uncertainty.

Here’s the thing; with the US entering a recession, it’s difficult for CFOs to forecast their financial hits more than a few weeks in advance.

Then again, states here at home, as well as other countries are coming off lockdown at different times and rates. And there is no universal agreement as to which businesses can open when and in what manner.

In an environment like this, snagging a roughly $1.8 billion multi-year contract is a god send.

Even better is the fact that the new pact is part of the Trump administration’s commitment to space exploration.

With that in mind, today I want to reveal the name of the company that just got an order for 18 new rocket engines.

It’s a storied small-cap leader whose profit growth is off the charts and should be on your wealth-building watchlist…

Star-bound Star

Now then, when we spoke back on May 8, I noted the Trump administration is pursuing outer space at breakneck speeds. Since then, the Space Force just got its official flag as the While House builds momentum for its lunar program.

Even better, last week marked the first time a commercial space firm has carried humans into Earth’s orbit. And of course, the SpaceX system successfully docked at the International Space Station.

This is great news for the future of commercial space exploration. However, as much as I’m thrilled about the feat, at this point there is no direct investment because SpaceX remains private.

But in the meantime, there’s a lot of money to be made on the nation’s moonshot program.

The effort falls under the name Artemis. And this is a complex multi-billion effort that plans to have a shuttle service to and from the moon in place by 2024.

To the Moon!

The first stage in that plan is to get the orbiter to the moon. And powering it will be engines made by one of the top – and least heard of – aerospace companies out there, Aerojet Rocketdyne Holdings Inc. (NYSE: AJRD).

The company has been around since 1915 and got involved with the US aerospace industry during WWII. Since then, it has been an integral part of the Pentagon’s and NASA’s biggest, boldest missions.

Artemis has a twofold goal. Reach the moon and establish an orbiter. Then on subsequent missions, a lunar module can shuttle between the surface and the orbiter.

If all goes according to plan, Artemis will be the first step in sending manned missions deeper into space and building a base camp on the moon, where it’s easier to launch deeper into space.

Aerojet has been chosen to build the main engines in the Space Launch System (SLS), the rocket that gets the Orion orbiter into space. It also has the contract for Orion’s main and auxiliary engines as well as the Launch Abort System motor.

This effort is seriously big money. For example, the SLS engines are about $100 million a pop. Aerojet already built 4 for the initial full test firing of the SLS in November. And it recently received another $1.8 billion contract for 18 more engines over the course of the Artemis program.

The entire Artemis project is budgeted for $20-30 billion over the next five years. And that’s on top of NASA’s $6 billion annual budget. Aerojet is in line for a big piece of that pie, now and going forward.

And the University of Pennsylvania’s prestigious Wharton School of Business projects that the current $350 billion space industry will hit $1.1 trillion by 2040.

Also remember, that many of these big sky projects don’t always come in on budget. So, there may be far more money in the system before all is said and done.

More Than Rockets

Aerojet builds engines for most major launch systems – Vulcan Centaur, Atlas V, Delta IV, and the upcoming Omega.

Yet Aerojet isn’t just about space travel. It’s also involved in some of the Pentagon’s big, new projects. It’s the go-to supplier for missile defense systems like Patriot and Aegis.

And its work on hypersonic engines (creating speeds above Mach 5, or around 3800 mph) for next-generation missiles and reconnaissance planes makes it a Pentagon favorite.

Simply put, Aerojet builds the propulsion systems that are helping the US military keep up in a rapidly changing world. And it has been doing this for nearly 8 decades.

In WWII, its jet-assisted takeoff (JATO) allowed military planes to take off from short runways and aircraft carriers. And it built the engines for the anti-aircraft HAWK missile, which is still in use more than 60 years later.

Aerojet also launched Apollo 11 and safely took astronauts to and from the moon. Its engines were on every space shuttle mission and it has over 1,600 launches under its belt.

Industry Goliath at David’s Size

You would think for all this going for it, Aerojet would be a major defense contractor with a $40 or $50 billion market cap.

But it’s only a tenth of that size. Its current market cap is just over $3 billion. That means these projects really boost its value. Just the SRS engine contract is more than half its current market cap.

And the fact that these contracts are backed by the US government and extend out decades means Aerojet isn’t sweating holding on to its current business or worried about new long-term business.

In a market as crazy as this one, Aerojet is a breath of sanity.

It’s a great stock that has become an essential part of the US military and space infrastructure that sticks to its knitting.

And that’s why this company is such an earnings powerhouse.

Over the past three years, it has grown per-share profits by a stunning 71%. At that rate, they’re doubling every year.

To be conservative in a weak overall economy, let’s cut that in half. Even then we can project a double in just two years’ time.

So, at the very least, this storied space leader should be on your wealth-building watchlist.

Cheers and good investing,

Michael A. Robinson

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Source: Strategic Tech Investor