Wolfe Research Initiates SpaceX with $175 PT and Outperform Rating

Wolfe Research analyst Emilee Deutchman initiated coverage on SpaceX with an Outperform rating and a price target of $175.00.

“We are initiating coverage of Space Exploration Technologies Corp (SPCX) with an Outperform rating and a $175 YE27 Price Target in the context of a Market Weight rating on the Space subsector of our Aerospace & Defense coverage universe.

We expect this stock to be in large part driven by a compelling thematic/story line where if investors believe the disruptive long-term potential then near-in valuation will be less important.

That said, a number of milestones should serve as catalysts to build confidence in the long term including checking off important test points on the Starship test program, sharp AI revenue growth and higher model adoption following the Cursor acquisition, and material growth in the subscriber base of the current earnings engine of the company in the Starlink business.

Shares are being offered at $135, which reflects sales multiples of 22X sales and 12X sales on our 2027 and 2028 estimates, respectively.

The stock’s N12M and N24M averages for the two years leading into the IPO (in the private market) averaged 28X and 16X (adjusted for xAI acquisition).

Our price target reflects an assumed 16X 2028 sales, which embeds our assumption that progress on the Starship in particular will occur through the end of the year to begin payload launches, which we see as the largest catalyst to unlock value.

Risks to our price target and rating include significant delays in the company’s Starship development program, launch vehicle accidents, lack of traction of subscriber uptake in the Starlink Service, lack of returns on outsized capital expenditures of AI build out, physical constraints including power access and regulatory restrictions hinder the compute build out, delays in the potential for orbital data centers and/or cost-effectiveness of the approach.”

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