Morgan Stanley: SpaceX at $100 Would Imply Zero Value for AI Business
Key Takeaways
- ▸SpaceX stock has fallen significantly since its June IPO, with concerns about a further drop to $100 when insider lockup expires next month
- ▸At $100, investors would effectively be pricing SpaceX's AI segment (Grok and Cursor) at zero or negative value
- ▸Morgan Stanley's Adam Jonas maintains a $300 price target with 50%+ attributed to AI, viewing current prices as an attractive entry point
Summary
SpaceX shares have tumbled since their record $86 billion IPO in mid-June, trading near $110 on Monday. Morgan Stanley analyst Adam Jonas warns that if the stock reaches $100—a level some investors expect when insider lockup expires next month—the market would be pricing in zero or even negative value for SpaceX's artificial intelligence segment, which includes Grok and Cursor. Jonas maintains a bullish $300 price target with over 50% attributed to the company's AI business, arguing investors are significantly discounting AI prospects despite the high capital expenditure requirements.
The sell-off reflects broader market rotation away from technology firms committing massive capital to AI infrastructure, exacerbated by macroeconomic concerns and geopolitical tensions driving oil prices higher. Despite the recent weakness, nearly 80% of Wall Street analysts recommend buying SpaceX shares, with an average price target of $232 implying a more-than-double upside. Jonas emphasizes that SpaceX remains uniquely positioned across launch, connectivity, and AI, viewing the current valuation as an attractive entry point for investors.
- Wall Street remains overwhelmingly bullish on SpaceX despite recent losses, with 80% of analysts recommending shares and an average $232 price target
