Morgan Stanley Issues SpaceX Target Value of ~$4T!

**John Johnston** (0:00)
The ratings are used by investors to help inform their stock purchases. Morgan Stanley rated the shares an overweight slash attractive and gave the stock a $300 price target. That's around a $4 trillion market cap. Hi everyone, JJ here. Welcome back. Well, today, as I speak, was the day that SpaceX was ushered into the NASDAQ 100 index, and therefore into a lot of people's retirement funds and this also happened. We have SpaceX wins bullish recommendations from Wall Street banks. This is the Financial Times. Morgan Stanley gives Musk's AI and rocket stock $300 price target as quiet period ends following record IPO.
So as we know, going into the index, just a couple of weeks after the IPO, the massive IPO, previously companies have had to wait 12 months and show sustained profitability, which SpaceX hasn't. But we have these investment banks giving price targets and that represents, Morgan Stanley represents about $4 trillion, nearly $4 trillion of market cap, market value. But we've also got this, I want to get to this.
The space bit of SpaceX is worth $8 a share says Morgan Stanley, and they have a breakdown of the different sectors in SpaceX there. We'll get into that. There's a bit of commentary from the Financial Times. But SpaceX has secured buy ratings or the equivalent from Aswath of Wall Street stock brokerages, lending further support to Elon Musk's newly floated AI and rocket company.
As it turns out, more much more AI than rocket company banks, including Goldman Sachs, UBS and Morgan Stanley issued bullish recommendations for SpaceX's stock on Tuesday, the first day of coverage following the end of the quiet period for banks that underwrote SpaceX's mammoth initial public offering. So they're allowed to do this now. And yes, when you know they're bullish, so the market is pretty bullish in general. And it remains to be seen whether these will be right. We'll look back on this period and see if they were correct or not. These experts, the ratings are used by investors to help inform their stock purchases and come after the shares shot up from their IPO price of $135 to as high as $225 before falling back to close at around $160 on Monday. What we can see now, as I speak, it's just under $150. This did not help the stock on the day down 6.83% on the day. And related news, Tesla didn't help Tesla at all. I mean, there was talk of Tesla being rolled into SpaceX at some point. A lot of Tesla investors want that. Tesla was down 4% on the day to $402.
Morgan Stanley rated the shares in overweight slash attractive and gave the stock a $300 price target, while Bernstein had an outperform rating of $239. So there's always a range here, but Morgan Stanley $300. I know Elon Musk had a lot of interaction with Morgan Stanley over the years. So UBS said the $2 trillion company had an unparalleled set of assets in its reusable rockets and constellation of Starlink satellites, initiating its coverage with a buy rating and a 12-month target of $220. So these days, it's pretty rare to have a sell rating from Wall Street on pretty much any stock. It used to be more common, as I understand, but these days pretty much hardly ever.
The Swiss bank said, advances in chatbot Grok and SpaceX's acquisition of AI coding startup Cursor were poised to narrow the gap between SpaceX and Frontier Labs, OpenAI and Anthropic. Well, that is an opinion, whether that happens remains to be seen. OpenAI and Anthropic really the leaders by market share. I think Grok had like 4% market share. The ratings came as SpaceX on Tuesday joined the NASDAQ, which was 100, as I said, forcing tracker funds tied to the index of largely tech stocks to buy the stock. Companies usually have to wait up to a year, as I said, after listing to gain entry into major indices. So the rules being changed for SpaceX, for Elon Musk. I wonder if this will be setting a precedent here, so this will happen more often. But I want to get into this story too.
The space part of SpaceX worth $8 a share. Here I will just skip down to the table here. We can see this is the base case DCF from Morgan Stanley research estimates. So they've got SpaceX at $8 a share, the connectivity at $128 a share, the X and Grok at $12 a share, and Enterprise AI at $152. So this should be some crossover between connectivity and Enterprise AI, really. I mean, you'd have to see how they break that down, but that equals to $300 target there. So that's how they break it down. So space, the launches. But let's see what this commentary is. It's interesting. Now, I can't have an opinion on the stock at all.