Morgan Stanley is not backing away from SpaceX. Analyst Adam Jonas reiterated his Overweight rating and $300 price target on Nov. 13. A level about 116% above the stock’s close that day, even as shares sat 31% below their June closing high and just 3% above the $135 IPO price.
Hours later, the rocket at the heart of his bull case delivered a mixed result. SpaceX’s attempt to catch the Starship booster failed, and it fell into the Gulf of Mexico and exploded, yet the spacecraft still reached orbit and released 26 Starlink satellites.
“Well, that certainly isn’t the news that we had hoped to hear for today,” said SpaceX launch commentator Kate Tice, as reported by The Associated Press.
Analyst Adam Jonas sticks with his call after a rough few months
Jonas had flagged the flight as a major moment for the stock. Before launch, he called it “one of the most significant potential catalysts in SpaceX’s nearly 25-year history,” with SpaceX aiming to catch both the Super Heavy booster and the Starship upper stage.
The launch also came as Bloomberg reported that SpaceX and Tesla could announce a merger by December or early 2027, with Musk saying both companies had formed independent board committees, according to Stocktwits.
Also read: Google’s SpaceX investment takes an unexpected turn
His valuation case leans on the long view. In a Nov. 3 note, Jonas said SpaceX traded at 17.6 times 2028 adjusted earnings, a hair below the S&P 500’s 17.7 times. “On FY28, SPCX trades cheaper than the S&P500. Interesting,” he wrote.
The analyst has been clear about what could break the thesis. In early October, with the stock near $159, he said shares could slide toward $100 within a year if AI momentum slowed. Starship hit a serious testing wall, or SpaceX needed a large equity raise, TheStreet reported.
The $300 target also depends heavily on artificial intelligence. Morgan Stanley assigns $170 of that value to SpaceX’s enterprise AI business, with connectivity making up most of the rest and the space unit contributing only a small slice.
How SpaceX shares lost their shine
The stock’s run since the IPO has been a roller coaster. SpaceX debuted at $135 on June 12, hit a record $225.64 on June 16, and was trading around $138 by midday on Nov. 13.
The slide started early. Just a month after its record listing, the largest IPO in history, the stock had already dropped to a record low, and analysts noted that price targets had “dislocated from its share price.”
Bulls did not flinch, with Raymond James analyst Brian Gesuale starting coverage at Strong Buy with an $800 target, as reported by TheStreet.
Skeptics have only grown louder. NYU professor Scott Galloway argued the stock is far too expensive, saying, “It’s still crazy overvalued. I think this is a $10 to $30 stock.”
Former Fidelity fund manager George Noble went further: “Grandma’s 401(k) now owns a $2 trillion company at roughly 90 times revenues. That’s outrageous.”
The business itself is growing fast but spending even faster. Third-quarter revenue reached $14.6 billion, and SpaceX earned $4.4 billion, yet capital spending hit $19.6 billion, and the finance chief expects $35 billion to $40 billion in the fourth quarter.
The Super Intelligence unit brought in $7.5 billion, more than half of sales, and Musk said “the constraint on deployment of super intelligence is more in power and cooling and infrastructure than it is in chips,” as reported by TechCrunch.
Starship’s flight brings good and bad news
The flight was meant to be historic. SpaceX planned to catch the spacecraft with mechanical arms on the launch tower, the first attempt to recover a Starship returning from orbit. The previous 14 Starship spacecraft all ended up in the ocean, and SpaceX gave no explanation for the booster failure.
Investors reacted cautiously. SpaceX shares slipped 2% after hours once the booster was lost, while the ship stayed in orbit ahead of its own catch attempt the following day.
Reusability is what makes the numbers work. Pivotal Research said SpaceX’s long-term case depends on flying each vehicle 20 to 50 times, calling refurbishment a “single admittedly massive engineering bottleneck.”
More SpaceX:
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- SpaceX’s multi-trillion-dollar case rests on a bet not yet launched
- Bank of America sends SpaceX stock investors strong signal
The stakes reach beyond Wall Street. NASA is paying SpaceX billions of dollars to land Artemis astronauts on the Moon, with Blue Origin as the other main contractor, and the agency expects to choose between SpaceX and Blue Origin a year before the Artemis IV landing, which could come as early as 2028, The Associated Press reported.
Why the target hinges on 2028 estimates
At today’s price, SpaceX trades at about 51 times 2027 earnings estimates. At $300, it would trade near 50 times 2028 estimates, so the target only works if those forecasts hold. The average analyst target has climbed to $256.
The spending plans keep getting bigger. On Nov. 12, SpaceX announced more than $74 billion in data center projects in Texas and Arizona, including a roughly $50 billion site in rural Cochise County, Arizona, that would use dry cooling. The plans arrived just as data centers were becoming a political flashpoint, with Texas Governor Greg Abbott pausing new construction pending a statewide audit, as reported by The Hill.
Funding is the open question. Analysts expect a large cash shortfall through 2028, and one AI customer made up about a third of third-quarter revenue.
The next big test comes with the fourth-quarter report in early 2027, which will show whether SpaceX hit its revenue goals and how it paid for its spending spree.
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