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Planet Labs Has Fallen Back to Earth, But Wall Street Still Sees a Rebound

Written by Leo Miller. Originally Published: 9/13/2026.

Like a rocket that must eventually return to Earth after takeoff, space and satellite stock Planet Labs PBC (NYSE: PL) has plummeted from its highs. Through the end of May, PL had risen nearly 160%. The stock had reached a market capitalization of more than $18 billion, despite generating just $307 million in sales over the preceding 12 months.

Shares have now declined even faster than they rose at the start of the year. Planet Labs’ 2026 gains have completely vanished, with shares now down roughly 15% year to date. Compared with its 2026 high, Planet Labs has fallen more than 60%.

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However, this move is more a function of a stock that had gotten ahead of itself than of deeply disappointing financial performance. Against this backdrop, Wall Street analysts are forecasting a large rebound, indicating a potential opportunity going forward.

The Q1 Report That Turned the Tide

Planet Labs recently posted its Q2 fiscal 2027 (FY2027) earnings report, but understanding the stock’s trajectory requires going back one quarter. Its Q1 FY2027 report marked the point at which the market began punishing the stock despite continued business growth.

In that Q1 report, Planet Labs posted revenue of more than $94 million, up 42% year over year (YOY), and beat estimates by more than $3 million. Its three-cent loss per share was better than expected. Its backlog surged 72% YOY to $906 million, and the firm raised its full-year revenue guidance. Despite this, shares tanked 26% the next day. Since then, the stock has plummeted by nearly another 50%.

Trading at a forward price-to-sales (P/S) ratio of more than 30 times before its report, anything short of massive beats would have left the stock’s valuation looking untenable. Investor expectations had gotten ahead of the company’s results, and shares have continued to fall as that valuation reset has played out. The latest quarter provides a clearer picture of where the business and stock stand now.

Planet Labs Crushes Q2, But With a Caveat

In fiscal Q2 2027, Planet Labs’ financial performance was even stronger than in the prior quarter. Revenue soared 58% YOY to a record $116 million, beating estimates by more than $11 million. This was the firm’s strongest revenue growth in four years. Additionally, the company swung from a seven-cent loss per share in the prior year to earnings of two cents per share, well ahead of the expected two-cent loss. The company also saw its Rule of 40 score improve to 70, versus 41 last quarter and 29 a year ago. The score is calculated by adding revenue growth to the company’s adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) margin, which was 12%.

However, there was a notable caveat to the strong quarter. Its sales outperformance was partially due to handing over a satellite to a customer during fiscal Q2 rather than during the expected fiscal Q3 timeline. Because timing rather than demand drove the outperformance, the company only slightly raised the low end of its full-year guidance. It now expects midpoint sales growth of 41.5%, up from 41% last quarter.

Meanwhile, its backlog fell 10% sequentially despite rising 11% YOY to $815 million, as new orders did not fully replenish deliveries. Despite posting many impressive metrics, shares fell more than 1% after the report. This further demonstrates how even moderate earnings blemishes can trigger negative reactions for a stock that still trades at a high multiple.

Analysts Eye Huge Rebound, But Planet Labs Still Isn’t Cheap

Planet Labs now trades at a forward P/S ratio of nearly 12 times. Notably, this figure has fallen more than 70% from its highs, but it is not low by any means. For reference, Planet Labs’ forward P/S ratio still ranks among the five highest of nearly 200 industrial stocks in the Russell 1000 Index. Thus, although its valuation indicates less risk than in the past, risk remains palpable in the broader context.

However, Wall Street analysts are clearly bullish on the stock’s outlook, with the MarketBeat consensus price target of $32.78 implying upside of well over 90%. Additionally, the average of targets updated after its report is slightly higher, at more than $33.

Looking ahead, one key watch item will be Planet Labs’ ability to convert its more than $4 billion pipeline into orders. Of that amount, the company classifies $1 billion as “near-term,” meaning it could convert this portion in the coming quarters rather than over several years. With its backlog currently at $815 million, converting a significant percentage of its near-term pipeline could materially improve its backlog and, in turn, its revenue visibility.

Planet Labs’ growth to this point has demonstrated its ability to succeed in the satellite and imaging market. However, whether this success will continue at a rate that satisfies the market is an entirely different question, one filled with uncertainty. Accordingly, taking a cautious approach to this stock remains paramount.