Morgan Stanley breaks down the market's space trade and shares 14 stocks for investors to keep tabs on

• Morgan Stanley has released its "Space 60" list.
• It highlights stocks across key categories, including raw materials, specialty materials, and propulsion fuels.
• Morgan Stanley sees rising investor interest in space-focused themes and technologies.

Outer space is in the cultural and market zeitgeist right now, and Morgan Stanley says investors are clamoring ways to invest in the theme.

So on Sunday—following the successful completion of the Artemis II mission, the release of the "Project Hail Mary" movie, and amid growing market chatter about the historic SpaceX IPO later this year—the bank released its "Space 60," a list of stocks spanning several investable themes.

"Space is back in a big way," Adam Jonas, an equity analyst, wrote in an April 12 client note. "A combination of scientific advancements, geopolitics and economics have rekindled investor attention on the Space theme to the highest levels we have seen since launching the Morgan Stanley Space Team nearly a decade ago."

The renewed excitement is backed up by the ever-growing number of objects being launched into space, particularly by the US.

We dig into the seven themes the bank highlighted.

Raw Materials & Mining

Metals are crucial to the buildout of space infrastructure, with rhenium, hafnium, and beryllium being the most critical materials.

"All space hardware begins in the ground," Jonas wrote. "A single satellite can use dozens of specialty metals across structural, power, thermal, and communication systems."

Metal-mining stocks the bank flagged include Alcoa and Freeport McMoran.

Specialty Materials & Alloys

Other materials, such as carbon fiber, glass, and alloy products, support the space buildout. Three of the so-called "super alloys" needed include inconel, wasaploy, and C-103, the bank said.

Two producers the bank said to watch in this theme include Materion and Corning.

Propulsion & Fuels

Rockets can't get off the ground without the right liquids and gases, like liquid methane, liquid hydrogen, refined kerosene, xenon, krypton, and argon.

"A single launch can require hundreds of tons of propellant with propellant often representing 85-90%+ of total launch mass," Jonas said.

Examples of stocks in this category include Linde and Air Products.

Electronics & Semiconductors

Here's an industry you might be a little more familiar with because of the AI trade: semiconductors.

Satellites in space need heavy-duty hardware that can withstand high radiation levels, allowing them to communicate with machines back on Earth.

Two stocks the bank highlighted in this theme are Nvidia and Broadcom.

Components & Subsystems

The components in something like a satellite also need to withstand extreme temperatures.

"Space systems depend on thousands of individual parts such as connectors, valves, bearings, actuators, and wiring harnesses," Jonas wrote, adding: "Failure of a single component can compromise an entire mission, particularly in systems with limited redundancy."

Examples of stocks the bank highlighted in this theme include Honeywell and Aptiv.

Spacecraft & Launch Systems

Jonas said these are companies designing rockets and satellites. Key factors to look for in stocks in this space include the reusability of their products, manufacturing scale, and launch cadence, he said.

A couple of stocks the bank flagged in this theme include Redwire and Rocket Lab.

Satellite Operators & Services

This category includes firms that provide communication and data services between Earth and spacecraft.

"Operators generate revenue by providing communication, Earth observation, navigation, and data services from orbit," Jonas said.

Examples of these stocks include Gilat Satellite Networks and Amazon.