Shares of MDA Space dropped sharply on Tuesday. The stock fell around 10% and touched $28.40, its lowest level since early March.
The decline has pulled the stock down about 13% from its recent high. Its market value now stands near $3.7 billion. The fall came even as the company continues to report strong financial growth.
MDA Space stock drops after NASA Artemis update
The main trigger behind the fall is uncertainty around NASA and its Artemis mission.
NASA recently announced that it plans to pause the Gateway project in its current form. The focus will now shift more toward building infrastructure for long term operations on the Moon’s surface.
This raised concerns among investors. MDA Space is linked to the mission through its Canadarm3 program.
However, the company clarified that its contract is with the Canadian Space Agency, not directly with NASA or the US government. It also said it expects Canada to continue contributing robotics technology to the Artemis mission.
Despite this reassurance, the market reaction remained negative in the short term.
MDA Space earnings growth remains strong
While the stock is under pressure, the company’s business performance tells a different story.
MDA Space reported a 44% jump in quarterly revenue, reaching $499 million. Its full year revenue crossed $1.65 billion, marking a 51% increase compared to the previous year.
Profitability also improved. Adjusted EBITDA rose 49% to $324 million, with margins touching nearly 19.8%.
Net income saw even stronger growth, climbing 71% to over $190 million.
Looking ahead, the company expects revenue between $1.7 billion and $1.9 billion this year. Margins are projected to stay between 18% and 20%.
MDA Space is also expanding into defense. It recently secured a $32 million contract from Canada’s defense department for space surveillance systems. Its backlog has now reached $4 billion, while its future pipeline stands above $40 billion.
MDA Space stock outlook and key price levels
From a technical view, the stock has seen a strong rally in recent months. It moved from $15 in November to a high of $33.72 earlier this month.
However, the rally paused after forming a double top pattern near $33.72, which is often seen as a bearish signal.
At the same time, there are some positive signs. The chart also shows patterns like an inverted head and shoulders and a cup and handle, both of which are considered bullish indicators.
Importantly, the stock is still trading above its key moving averages. This suggests that buyers are not fully out of the picture.
In the near term, volatility is likely to continue. If momentum returns, the stock could retest the $33.72 resistance level. A break above that may open the path toward its all time high of $35.27.