Morgan Stanley Initiates SpaceX at Overweight, $300 PT
Morgan Stanley analyst Adam Jonas initiates coverage on SpaceX (NASDAQ: SPCX) with a Overweight rating and a price target of $300.
“Key Fundamental Drivers of SPCX Stock Over the Next Few Years 1. How Does SpaceX Monetize Enterprise AI?
While neo cloud deals are the bulk of the business near term, we see end-to-end AI services as the longer-term business model.
We believe the progress of Cursor, including annual recur ring revenue estimated at $4 billion and ongoing Pareto fron tier performance, remains underappreciated by the market. 2.
Can SpaceXAI Achieve Industry-Leading Cost and Time-to-Power?
A large portion of SPCX’s capex is directed toward Terafab, Solarfab, and other vertical integration efforts (including blade/vane foundry, terrestrial communi cations infrastructure) to drive down both $/watt and time to-power on Earth before moving AI “off Earth”.
While we are believers in the advantages of space-based AI infrastructure over the long-term, we also think the market underappreci ates SPCX’s terrestrial AI economics, with cost per watt run ning at half the industry average, excluding chips, and deployment speeds ~6-8x faster than peers.
3. Will Starship Achieve a Step Change in Economics?
Rapid reusability of both the first and second stages is key to increasing mass-to-orbit capacity and lowering launch costs ($/kg), but the program is still in early testing.
The testing regime won’t be easy, but we ultimately see a path to launch costs of ~$500/kg by 2030 and below $150/kg by 2040, which could materially expand both connectivity and AI TAMs. 4.
Will Starlink Achieve Broad TAM Adoption?
Starship, V3 broadband satellites, and Mobile Gen 2 satellites should sig nificantly expand available capacity, enabling materially improved speeds, lower latency, and more effective pricing across consumer, enterprise, government, and mobile mar kets.
Longer term, the primary driver is Starlink becoming a connectivity layer for virtually every data-transmitting device that requires reliable coverage beyond the reach of terrestrial infrastructure.”
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