SpaceX (NASDAQ: SPCX) July 7 inclusion into the Nasdaq-100 index was accompanied by a veritable flood of analyst ratings, including the equity’s latest and staggering Street high price target.
Specifically, Raymon James analyst Brian Gesuale initiated SPCX coverage on Tuesday with a bullish ‘Buy’ recommendation and a forecast that the stock would soar 439.59% to $800 within the next 12 months.
According to the note, the positive attitude and the associated SpaceX stock price target primarily hinge on the company’s potential to become a veritable infrastructure giant, as well as on programs and projects like Starship and Starlink.
Wall Street predicts SpaceX stock price for the next 12 months Simultaneously, though the Raymon James $800 forecast was a standout considering it predicts a 439.59% rally from SPCX shares’ latest close at $148.26, it was merely one of the numerous ‘Buy’ recommendations issued within the last two days.
Indeed, the latest series of notes altered the overall balance of ratings and turned Elon Musk’s newer public company into a ‘Strong Buy,’ with a total of 22 such rankings, 4 ‘Hold’ assessments, and only a single ‘Sell’ rating.
Additionally, SpaceX stock is, on average, expected to rocket 65.85% to $245.96 in the next 12 months, per the data Finbold retrieved from TipRanks on July 9, 2026.
Wall Street sets SpaceX stock price target for the next 12 months. Source: TipRanks Meanwhile, Wall Street’s optimism has, so far, not been matched by SPCX shares’ actual stock market performance.
SPCX stock price performance since the SpaceX IPO After an initial SpaceX rocketing to its all-time high (ATH) of $225.64 just four days after the initial public offering (IPO), the equity found itself crashing and has, in the last week, generally been gravitating toward its June 12 opening price of $150.
SpaceX stock price one-week chart. Source: Google Still, shares of SPCX remain 9.82% above their IPO price of $135, and the Thursday pre-market shows some signs that a rally might launch SpaceX higher soon, as it, by press time, featured a 1.81% rally to $150.95.
Featured image via Shutterstock
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Space Exploration Technologies' (SPCX +0.58%) initial public offering has dramatically increased investor attention around space stocks. One that is definitely worth a closer look is Rocket Lab (RKLB +0.92%).
SpaceX is set to join the Nasdaq-100 on July 7, which could drive index-tracking funds to buy the stock. However, SpaceX's initial index weight is estimated to be less than 1%, as the Nasdaq-100 adjusts for public float, or the percentage of shares available for public trading.
So, while SpaceX may dominate the headlines, Rocket Lab's backlog, contracts, and execution milestones still give investors reasons to take the company seriously as a space and satellite stock.
Image source: Getty Images.
Why Rocket Lab Still Matters Rocket Lab is already demonstrating solid business momentum. In the first quarter, revenue jumped 63.5% year over year to $200.3 million. The company's generally accepted accounting principles (GAAP) gross margin was 38.2%, while backlog rose 20.2% sequentially to $2.2 billion.
The company also signed 31 new contracts for Electron, its small rocket, and HASTE, its defense-focused launch vehicle used for hypersonic testing. The company also added five contracts for Neutron, its larger rocket, which is still under development. Rocket Lab had over 70 contracted launches in its backlog at the end of the first quarter.
SpaceX's IPO has undeniably brought more attention to the space industry, but Rocket Lab's case is not based only on market excitement. Rocket Lab expects second-quarter revenue to fall in the range of $225 million to $240 million, up 16% sequentially at the midpoint.
Rocket Lab is expanding beyond launches Rocket Lab's planned $8 billion acquisition of Iridium Communications (IRDM +0.40%) can prove to be a long-term catalyst. Iridium already operates a low-Earth-orbit satellite network and has more than 2.5 million subscribers across government, aviation, maritime, defense, and enterprise markets. If the deal closes, Rocket Lab would not only build and launch satellites but also operate them. It could also operate a satellite network and sell communication services.
In March 2026, Rocket Lab also signed a $190 million HASTE contract with Kratos Defense & Security Solutions for the U.S. Department of Defense's MACH-TB 2.0 hypersonic testing program. The contract covers 20 hypersonic test flights over four years and is the largest launch contract in the company's history. Hence, Rocket Lab is also building a defense-focused business rather than just competing with SpaceX on regular satellite launches.
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Risks to consider The neutron rocket is important to the company's ambition to handle larger satellites, government missions, and larger commercial missions. However, Rocket Lab has pushed Neutron's first launch target to the fourth quarter of 2026 after a development setback. Any further delay could hurt investor confidence.
Rocket Lab is also still unprofitable. The company reported a net loss of $45 million in the first quarter and expects an adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) loss of $20 million to $26 million in the second quarter.
Customer concentration and government exposure can also pose risks. In 2025, the company's top five customers accounted for 49% of revenue. The top five backlog customers also accounted for 77% of its backlog. Rocket Lab also earned 47% of its revenue from U.S. government-related contracts, many of which were fixed-price contracts, in 2025.
Investors should closely monitor both growth catalysts and risks before treating Rocket Lab as a simple SpaceX alternative.
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Elon Musk took SpaceX public in June. TIMOTHY A. CLARY / AFP via Getty Images Elon Musk says SpaceX's blockbuster valuation has likely turned thousands of his employees into millionaires.
During a Wednesday interview on "The Sean Hannity Show," Musk was asked about a former SpaceX welder who was granted stock that soared to over $1 million in value after the company went public in June with a roughly $2 trillion market capitalization.
"It's not just one welder, it's several thousand people who were working on the production line, and if they started at the company relatively early, then probably their stock is worth over a million dollars at this point," Musk told stand-in host Texas Gov. Greg Abbott over the phone.
The Tesla and SpaceX CEO, whose personal wealth briefly crossed $1 trillion following SpaceX's IPO, said: "I've always had the philosophy that everyone at the company should receive stock in the company, so that they can participate in the upside of the company."
"It's great for aligning incentives as well, so as the company prospers, then the people at the company, the employees, also prosper," he added.
SpaceX didn't immediately respond to a request for comment.
Ahead of SpaceX's June 12 listing, Andrew Benson, the founder of pre-IPO trading platform Hill Markets, estimated the IPO would mint 4,400 new millionaires and over 400 centimillionaires.
Business Insider's Tom Carter spoke to a former SpaceX employee who said the company awarded its workers with stock options when they joined the company, at their annual reviews, and when they were promoted.
Employees were also allowed to sell some of their holdings to the company or investors in private liquidity events, usually held twice a year, the former employee said.
SpaceX CEO Gwynne Shotwell and her husband have moved to expand the number of beneficiaries of SpaceX's success by donating roughly $300 million worth of the company's stock to Trump Accounts — a government program intended to open an account with $1,000 in it for every American child born between the start of 2025 and the end of 2028. The gift won praise from Trump on Truth Social.
SpaceX stock jumped from its IPO price of $135 to over $200 in the days following its public debut, but has fallen to below $148 as of Wednesday's close.
In addition to discussing the IPO's financial benefits, Musk spoke with Abbott about his long-term ambitions for SpaceX.
Musk said he hopes that in 10 years' time, the company will have "established a base on the moon" and "enabled thousands, if not tens of thousands of people" to go there.
"We want to make the things that people see in science fiction, not fiction — we want to make them real," Musk said, adding that SpaceX's Starship system is "designed to carry ultimately tens of thousands of tons to the moon, to create effectively a city on the moon, and ultimately a city on Mars as well."
Musk added that "if things go well," SpaceX might send the first humans to Mars in about five years, and thousands of people to the red planet in 10 or 12 years.
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Theron Mohamed You're currently following this author! Want to unfollow? Unsubscribe via the link in your email.
Theron Mohamed is a London-based correspondent on the Trending team at Business Insider. His coverage spans finance, investing, wealth, markets, and the economy.Theron joined BI in 2019 as a reporter at Markets Insider and rose to the rank of correspondent before moving to the Trending team in 2024. He previously covered tech, media, and telecom stocks for Investors Chronicle magazine and had a brief stint on the Financial Times' Data team. He interned at the Wall Street Journal in New York where he primarily wrote for Heard on the Street.Theron has freelanced for The Independent, The Telegraph, WIRED, and several smaller publications. He holds an undergraduate degree in geography from the London School of Economics, and a master's degree in journalism from Columbia University.Theron often covers Warren Buffett, Michael Burry, Jeremy Grantham and other top-flight investors. He also writes about the world's wealthiest people and shares financial advice from all manner of rich and successful people.Email Theron at [email protected] and follow him on X @theron_mohamed.Expertise
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Space Exploration Technologies (SPCX 0.78%) made its public debut on June 12. The initial public offering (IPO) was historic not only because the company raised a record $75 billion, but also because its market value was an unprecedented $1.7 trillion at the IPO price of $135 per share.
SpaceX soared 50% during the first three trading days, hitting a high of $202 per share amid strong demand from retail and institutional investors. But the stock has since fallen 26% to $150 per share because of anxiety about the company's recent bond offering and the upcoming lockup expiration dates.
Here's what investors need to know.
Image source: Getty Images.
History says SpaceX stock could fall much further in the coming months Since 1980, the average IPO stock has gained about 19% on the first trading day, according to Jay Ritter, professor emeritus of finance and director of the IPO initiative at the University of Florida. SpaceX fit that pattern perfectly. Shares closed at $161 on June 12, representing 19% upside from the IPO price of $135.
However, excitement surrounding IPOs tends to fade quickly, and companies that go public at large market values have historically performed poorly during the first year. The following chart lists the 15 largest U.S. IPO stocks (by market value at the IPO price) excluding SpaceX; for each stock, it shows (1) the one-year return and (2) the maximum drawdown in the first year relative to the IPO price.
IPO Stock
1-Year Return
Max Drawdown
Meta Platforms
(31%)
(53%)
Uber Technologies
(27%)
(67%)
Rivian Automotive
(58%)
4%
Coinbase Global
(41%)
(41%)
Venture Global
(59%)
(76%)
Coupang
(46%)
(48%)
General Motors
(34%)
(40%)
Airbnb
165%
84%
Visa
28%
(4%)
Kenvue
(13%)
(17%)
DoorDash
62%
11%
Rocket Companies
(3%)
(8%)
UiPath
(68%)
(68%)
Snowflake
170%
(57%)
Robinhood Markets
(76%)
(82%)
Average
(2%)
(23%)
Data source: First Trust, Bloomberg. Returns are relative to IPO prices.
Among the 15 largest U.S. IPOs, the average stock traded 2% below its IPO price after a year, but it dropped 23% from its IPO price at some point during the first year. Past results are never a guarantee of future returns, but we can use those numbers to make an educated guess about what SpaceX stock might do in the future.
If SpaceX's performance matches the historical average, the stock will trade near $132 per share (2% below its IPO price) by June 2027. That implies 11% downside from the current share price of $149. In that scenario, $20,000 invested in SpaceX today would be worth about $17,800 by June 2027.
But history also says SpaceX will drop 23% from its IPO price at some point in the first year. That would bring the stock to $104 per share, which implies 30% downside from the current price. In that scenario, $20,000 invested in SpaceX today would be worth about $14,000 at some point in the next year.
SpaceX shares available for public trading will increase sharply once lockups start expiring SpaceX issued 555 million shares for its initial public offering, bringing the total number of shares outstanding to 13.1 billion. That means less than 5% of SpaceX stock is currently available for public trading, while the other 95% (held by employees and insiders) is subject to various lock-up periods.
Those lock-up periods start expiring in a few weeks. In late July or early August, following the company's second-quarter financial report, at least 20% of early release shares (about 911 million shares) will become eligible for public trading. That means the float will more than double to reach 1.5 billion shares.
However, lockup expirations don't stop there. Another 7% of early release shares (about 320 million shares) will become eligible for public trading at 70 days, 90 days, 105 days, 120 days, and 135 days post-IPO. That means the float will double again, reaching at least 3 billion shares by late October.
Here's the big picture: Stock prices are determined by supply and demand. The number of SpaceX shares available for public trading will increase greatly in the coming months, and the stock price could drop, perhaps sharply, as the market digests that supply increase.
So investors need not rush to buy SpaceX stock today. More attractive opportunities are likely to arise in the future. That is particularly true because the stock currently trades at 101 times sales, making it the most expensive stock in the Nasdaq-100 by a wide margin. Rocket Lab ranks second at 73 times sales.
Trevor Jennewine has positions in Visa. The Motley Fool has positions in and recommends Airbnb, DoorDash, Meta Platforms, Rocket Companies, Rocket Lab, Snowflake, Uber Technologies, UiPath, and Visa. The Motley Fool recommends Coinbase Global, Coupang, General Motors, and Kenvue. The Motley Fool has a disclosure policy.
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Trump praised what he called the "extreme generosity" of SpaceX President Gwynne Shotwell and her husband. Dia Dipasupil/Getty Images; Anna Moneymaker/Getty Images President Donald Trump took to Truth Social to thank SpaceX president Gwynne Shotwell for her and her husband's stock donation to Trump Accounts, which he said was worth $325 million.
"Thank you to the brilliant and highly respected Gwynne Shotwell, and her husband, Robert, for their extreme generosity in helping children to attain the ever magnificent American dream!" Trump wrote on Truth Social.
Trump took to Truth Social to thank Gwynne Stockwell and her husband for their $325 million donation. Truth Social "Their Gift of 325 Million Dollars of SpaceX Stock is greatly appreciated by all," the president added, signing off by wishing the couple "continued Great Success!"
Shotwell did not put a value on the gift when she announced it on X, saying only that she and her husband would give a share of their SpaceX stock to a Trump Account for each of more than 2 million American children.
At Wednesday's closing price of $148 per share, the shares were worth about $296 million, reflecting a slight decline in SpaceX's share price since the gift was announced on Monday, when they were valued between $320 million and $325 million.
Trump wrote that "thousands of children have just been given a better life," though Shotwell's announcement said the gift would reach more than 2 million 11 to 17-year-olds in lower-income areas, with extra emphasis on those near the couple's central Texas home.
The donation makes Shotwell, Elon Musk's second-in-command, one of the largest known individual contributors to Trump Accounts, the tax-advantaged savings vehicles seeded with $1,000 from the Treasury for every American child born between 2025 and 2028.
Billionaire founder Michael Dell and his wife, Susan Dell, have contributed $6.25 billion to Trump Accounts, prompting a ringing endorsement from the president.
"They are truly incredible people. Go out and buy a Dell computer," Trump told reporters on Monday. "I have a son that loves their laptop."
Shotwell's gift comes after Trump said last week that he expected Musk would donate SpaceX stock to the program.
Neither Trump nor Musk has publicly confirmed whether the world's richest man has made a donation.
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Georgia Hennessy You're currently following this author! Want to unfollow? Unsubscribe via the link in your email.
Georgia is a fellow at Business Insider's London office.Before joining Business Insider, she worked at Japan's largest newspaper, The Yomiuri Shimbun, and interned at the Financial Times. She is an NCTJ-qualified journalist with a degree in Philosophy from the University of Birmingham. You can contact her via email at [email protected]
On Wednesday, SpaceXAI launched Grok 4.5, its newest AI model designed to help users write code, complete complex work tasks, and handle research-heavy projects.
SpaceXAI (formerly xAI) operates as a wholly owned artificial intelligence unit of Space Exploration Technologies Corp. (NASDAQ:SPCX).
The company said Grok 4.5 is its strongest model so far and was trained alongside Cursor.
SpaceXAI said the model can build apps from simple prompts, create Excel models, draft PowerPoint slides, and write clear documents in Word.
The company priced Grok 4.5 at $2 per million input tokens and $6 per million output tokens, making it cheaper than some rival AI models.
SpaceXAI’s Grok 4.5 could pressure enterprise AI pricing by offering a lower-cost option for high-volume coding and agentic AI workloads, according to Counterpoint analyst Neil Shah.
Grok Targets Enterprise AI Cost PressureShah said on Thursday that enterprises are facing “token bill shock” as autonomous agents and coding tools consume large volumes of tokens, making AI adoption increasingly expensive.
He said Grok 4.5 enters the market as a fast, “good enough” and cheaper model priced at $2 per million input tokens and $6 per million output tokens, below Anthropic’s Claude Opus 4.8 pricing of $5 for input and $25 for output.
Analyst Sees Multi-Model AI ShiftShah said enterprises are moving toward diversified AI stacks, in which they route workloads based on cost, speed, and accuracy rather than relying on a single model provider.
He said companies could use Claude for complex, high-stakes tasks while using Grok for high-volume developer workflows and repetitive agentic routing.
Shah said Grok’s access to Cursor telemetry data could help it improve through developer interaction feedback.
He added that if Grok maintains its cost advantage while narrowing the accuracy gap, it could reshape enterprise AI economics and pose a new pricing threat to OpenAI and Anthropic.
SPCX Price Action: SpaceX shares were up 0.88% at $149.60 during premarket trading on Thursday, according to Benzinga Pro data.
Photo via Shutterstock
Market News and Data brought to you by Benzinga APIs
SpaceX's Starship 39 rocket launches from Starbase during the 12th test flight on May 22, 2026. (RONALDO SCHEMIDT / AFP via Getty Images)
Wall Street loves SpaceX stock. The average analyst price target is about $240, valuing Elon Musk’s rocket and AI company a cool $3.2 trillion, more than Microsoft, Amazon.com, or even Tesla.
Space Exploration Technologies (SPCX 1.02%), or SpaceX as most know the company, recently became the largest IPO in history. But investors may not realize just how little of the company is currently trading on the market. SpaceX sold 555.6 million shares to public investors, which sounds like a lot, but it's not. That's only about 4% of the total company.
Major investors, employees, and insiders own the rest. That includes CEO Elon Musk, who owns approximately 42% of the company through a combination of more than 4.8 billion shares and stock options. However, Musk is bound to an extended lockup provision that prevents him from selling any of his shares until June of next year, or 366 days after the IPO.
Here's a look at how these provisions might affect SpaceX stock between now and then.
Image source: The Motley Fool.
SpaceX structured its lockup window to minimize volatility Musk and his companies have an enormous following, especially among individual investors. SpaceX tried to account for this when it planned out its lockup periods. Lockups prevent insiders and major investors from dumping shares on the market once a company goes public. Typical lockups expire after 180 days, but SpaceX has staggered its lockups to minimize volatility in its share price.
There are multiple lockups, not including the extended lockup Musk is subject to.
Investors can sell up to 20% of their stock shortly following SpaceX's second-quarter earnings report, its first since the IPO. Another 28% unlocks following the company's third-quarter earnings report. Investors might be able to sell more, based on how the stock is trading at the time.
Additionally, shares will steadily unlock in 7% increments, regardless of share price, on days 70, 90, 105, 120, and 135 after the IPO. Any remaining shares, excluding the extended lockup, unlock at the traditional 180 days.
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Musk's eventual lockup expiration could weigh on an expensive stock The important point here is that the number of shares available for trading will increase significantly over the next six months. Although it's unlikely that Musk will dump his stake next year, even trimming it to monetize some of his fortune could continue to push lots of new shares into the market a year after the IPO, after a ton of stock has already flooded the market. That could weigh on the share price without sufficient demand to absorb all those additional shares.
It's not the only factor. SpaceX went public amid a ton of hype and excitement, which drove the stock's valuation to pretty lofty heights. The stock still trades at over 100 times its 2025 revenue of $18.6 billion. In other words, there's a ton of room for shares to fall if sentiment turns south. It's a risk worth considering when deciding whether to buy the stock.
After its blockbuster IPO, SpaceX (SPCX 0.78%) is now one of the largest money-losing businesses the world has ever seen.
According to SpaceX's IPO prospectus, the company lost $4.94 billion on $18.7 billion in revenue. Data for the first quarter of 2026 suggests that losses are accelerating. So far in 2026, the company has lost $4.28 billion on $4.7 billion in revenue. Scaled up to an entire year, the company is on track to lose around $17 billion on roughly $19 billion in sales.
Net losses, it seems, are accelerating even faster than revenue growth. Keep in mind, however, that the company did eke out a $756 million profit in 2024 off $14 billion in sales.
Why are expenses outpacing sales? One key culprit is to blame.
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This is why SpaceX is losing billions of dollars Morgan Stanley analysts predict SpaceX will generate $3.4 trillion in revenue by 2040. Goldman Sachs, meanwhile, sees SpaceX's revenue surpassing $300 billion by 2030.
Note that both firms were underwriters for SpaceX's IPO and thus may have internal incentives to sell the promise of SpaceX's growth potential. But understanding where all of this growth is expected to stem from reveals why SpaceX is currently posting large and growing net losses.
Image source: Getty Images
Diving into SpaceX's IPO prospectus, investors should quickly realize that the company is not primarily a rocket stock or a satellite stock, even though both of those categories are critical to its long-term growth potential. In reality, SpaceX is a bona fide AI stock.
"We believe we have identified the largest actionable total addressable market in human history," the company claims. "We estimate that our quantifiable TAM is $28.5 trillion." Less than 10% of that total opportunity, however, deals with Starlink internet satellites or rocket development. Nearly all of it deals with a single opportunity: AI.
The growth potential of AI is why SpaceX is spending so heavily on growing that segment, even though it generated just $3.2 billion in revenue last year.
Spending for SpaceX's AI segment is extreme. The company acquired Anysphere, for example -- the start-up behind Cursor, an AI coding assistant -- in a $60 billion deal. And first-quarter capital expenditures this year reached $10.1 billion, with AI accounting for $7.7 billion of that sum.
This pace of spending isn't expected to abate anytime soon.
"Developing, training, and providing inference for frontier AI models requires substantial and growing capital expenditures, including investments in specialized computing hardware, data center infrastructure, energy procurement, and technical personnel, and we expect these costs to continue to increase for the foreseeable future," SpaceX's IPO prospectus admits. "In addition, we plan to allocate substantial capital to build our AI compute infrastructure, and we expect a multiyear investment horizon before these deployments translate into sustained positive AI segment adjusted EBITDA."
To be clear, SpaceX's Connectivity segment -- which includes its Starlink internet service -- appears to generate impressive positive gross margins with equally impressive top-line growth. Its rocket division, meanwhile, is arguably the most advanced the world has ever seen, with a key role in enabling other long-term growth opportunities such as orbital data centers and a human colony on the moon.
But make no mistake: SpaceX's future will hinge on the success or failure of its AI division. It's this division that is responsible for SpaceX's mounting losses, even though those losses are largely a result of heavy investment designed to scale that segment as fast as possible.
Market conditions, therefore, will prove key to SpaceX's future. The company will need to return to capital markets again and again to raise fresh funds to support its growth build-out and plug its financial losses. Growth may occur as expected should markets remain strong. But if capital grows scarce, the entire SpaceX story grows far more uncertain.
Getting added to the Nasdaq-100 is usually a good day for a stock. Funds that track the benchmark have to own it. And for SpaceX (SPCX 1.02%), that meant billions of dollars of forced buying into a company whose public float is only a few percent of its shares.
On paper, that is a lot of demand chasing very little stock.
Yet a day after joining the index on July 7, SpaceX trades about 35% below its high of $225.64, changing hands for less than $147 as of this writing. That is below where the stock started when the company went public in June, in the largest U.S. initial public offering on record. It slipped about 6% in the session right after inclusion, giving back nearly all of its post-IPO gains.
So is the drawdown a chance to buy one of the most talked-about companies in the world at a discount? Or is the slide telling investors something?
Image source: Getty Images.
A classic sell-the-news move In short, this looks like a classic sell-the-news event. Sure, some buying was required because of the index inclusion. But that doesn't prevent investors from selling. And, ultimately, Wall Street seems convinced that shares aren't quite worth the premium they were commanding leading up to the event -- and especially not worth the all-time high they hit shortly after the IPO.
This sell-the-news dynamic following an index inclusion has happened before. Palantir peaked right around its own Nasdaq-100 addition in late 2024, then fell about 25% over the following weeks.
In addition, joining an index can broaden a stock's ownership over time, but it does nothing to change what the underlying business is worth.
And that, of course, is the harder question here.
At the time of this writing, SpaceX carries a market capitalization of about $1.9 trillion, making a shortlist of companies that have ever commanded a value this high. And SpaceX has reached this valuation while still losing money. In 2025, the company generated about $18.7 billion in revenue, up about 33%, so investors are paying around 100 times sales.
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What the $1.9 trillion price demands Sure, there's a real business beneath the company's $1.9 trillion market value.
Starlink, SpaceX's satellite internet service, crossed 10 million active customers earlier this year and brought in more than $11 billion in revenue in 2025, about 61% of the company's total. This is the part of the story I find most impressive: a large, fast-growing subscription business, and the main reason SpaceX can command a price in the trillions at all.
But growth alone isn't the whole story.
SpaceX is deeply unprofitable, reporting a net loss of $4.9 billion in 2025 and $4.3 billion in the first quarter of 2026. A big piece of that traces to xAI, the artificial intelligence (AI) start-up SpaceX absorbed earlier this year. Its AI segment generated $3.2 billion in 2025 revenue but burns far more, and management has floated even bolder plans, including putting AI data centers in orbit. Add the cost of scaling Starship, and free cash flow is deeply negative.
So the price is asking a lot. It assumes Starlink keeps compounding, that Starship's launch cadence ramps on schedule, and that the money flooding into xAI eventually earns a return rather than quietly consuming Starlink's profits.
Any one of those slipping could leave the stock exposed. At about 100 times sales, there is little room for the ordinary stumbles that come with building rockets and AI models at once.
To be fair, this is a singular company. Its assets are hard to copy: a reusable rocket fleet, a satellite network already circling the planet, and a founder who has repeatedly pulled off what looked impossible. For investors who believe SpaceX will own space-based connectivity and compute for decades, a 33% pullback may look like an opening.
I'm not there yet. The drawdown makes the stock cheaper than it was a week ago, but cheaper and cheap are not the same thing. With the company still losing billions, I think its near-$2 trillion market capitalization leaves no cushion at all. I would rather watch SpaceX show that Starlink's profits can outrun its spending before paying up -- even after a sharp one-day drop.
The move automatically added the stock to hundreds of ETFs and mutual funds that track the technology-heavy benchmark, making SpaceX a new holding for passive investors across retirement accounts, brokerage portfolios and workplace savings plans.
• SpaceX stock is testing lower boundaries. Why did SPCX hit a new low?
Why SpaceX’s Weight Is Smaller Than What its $2 Trillion Valuation SuggestsDespite carrying a market capitalization of more than $2 trillion, SpaceX entered the Nasdaq-100 with an estimated weight of just 1.3%.
The reason lies in the company’s limited public float.
Only a small percentage of SpaceX shares became publicly tradable through its IPO, while founder Elon Musk retains roughly 82.4% of the company’s voting power through its dual-class share structure. Because the Nasdaq-100 weights companies based on their float-adjusted market capitalization rather than full market value, Nasdaq scaled SpaceX’s effective capitalization to approximately $300 billion for index purposes.
That adjustment prevents the newly listed stock from dominating the benchmark despite its headline valuation and limits its immediate impact on passive portfolios.
Passive Investors Have Few Ways to Avoid SpaceXFor investors tracking the Nasdaq-100 through ETFs, avoiding SpaceX is no longer an option unless they switch benchmarks altogether.
Unlike the Nasdaq, the S&P 500 has not relaxed its eligibility requirements for newly listed companies. SpaceX still does not meet the index’s requirements, including at least one year of public trading history and four consecutive profitable quarters. As a result, investors in S&P 500 ETFs remain insulated from the stock for now.
The rapid inclusion was made possible after Nasdaq earlier this year shortened the waiting period for qualifying IPOs from a minimum of three months to just 15 trading days. SpaceX, which debuted on June 12, became the fastest company ever to join the Nasdaq-100 following the rule change.
Active Managers Are Buying the DipWhile passive funds were forced buyers, some active managers are also increasing their exposure.
Wood has previously argued that emerging businesses such as orbital data centers could expand SpaceX’s long-term revenue potential by 10 to 20 times, reinforcing her bullish outlook despite the recent decline.
Volatility Could PersistAlthough passive ETF demand is expected to provide near-term support for the shares, analysts caution that volatility may remain elevated.
Over the coming months, employee lockup agreements will expire in stages, increasing the number of shares available for trading. The additional supply could offset some of the buying pressure created by index funds, particularly as SpaceX continues to trade with a relatively limited public float.
The dynamic sets up an unusual tug-of-war between automatic ETF buying and fresh insider selling, leaving passive investors with exposure to one of the market’s newest, and potentially most volatile, mega-cap stocks.
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This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
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SpaceX stock closed at $148 on Wednesday, below the company's first trading price of $150 per share for a second day in a row.
Elon Musk's aerospace and defense contractor was included in the Nasdaq-100 index on Tuesday, less than a month after its stock market debut on June 12. The rapid inclusion in the Nasdaq-100 was due, in part, to the exchange's revised rules for new public companies to become part of that widely-tracked benchmark.
The SpaceX inclusion also required index funds and exchange-traded funds that are tied to the benchmark to buy shares of the company in order to match the new lineup.
SpaceX's record initial public offering raised a total of $85.7 billion after underwriters exercised the "greenshoe" overallotment, which allows companies to issue more shares in an IPO when there is greater demand from participants during the initial offering. SpaceX initially offered 555.6 million shares for a set price of $135 each.
The stock soared in the days following its debut, notching a closing high of $201.80 on June 16.
Read more CNBC tech newsChinese lidar maker with Nvidia ties accused of being cyber risk for U.S.China's Alibaba bans Anthropic AI for employees after 'distillation attack' accusationSpaceX President Gwynne Shotwell to donate stock to Trump AccountsMicrosoft cuts 4,800 jobs, as Xbox unit downsizes and plans to spin off four gaming studiosMostly bullish analyst ratings followed the inclusion into the Nasdaq-100.
Morgan Stanley initiated coverage, rating shares of SpaceX as "overweight" with a price target of $300. Bernstein initiated coverage at "outperform" with a price target of $239. RBC initiated with an "outperform" rating and price target of $225. UBS initiated with a "buy" rating and 12-month price target of $210 per share.
Bulls pointed to the company's lead in reusable rocket technology and launch services, its vast Starlink satellite internet service and the potential to improve the margins for both of these businesses.
For growth, analysts pointed to SpaceX's potential to develop artificial intelligence products and services ranging from agentic coding tools to rival Anthropic's Claude or OpenAI's Codex and the development of orbital data centers.
In the more skeptical minority, MoffettNathanson initiated coverage of SpaceX with a neutral rating, and CFRA recommended selling shares.
— CNBC's Michael Bloom contributed to this report.
SpaceX has been fast-tracked into the Nasdaq-100 Index, meaning the stock performance of Elon Musk’s rocket company is now directly tied to the retirement accounts, mutual funds and portfolios of millions of everyday American investors.
But self-proclaimed market "permabear" and GMO co-founder Jeremy Grantham is heavily skeptical of the company's valuation and long-term investment thesis.
"Everyone’s lining up to tell you to buy the craziest IPO in the history of man," Grantham told Morningstar’s "The Long View" podcast. "In 50 years, they’ll be telling and writing stories about SpaceX, and they’ll be quoting you paragraphs from the prospectus, and you will be laughing at it."
D.O.G.E. WEBSITE DEACTIVATES AFTER REACHING SELF-TERMINATION DEADLINE: ‘COME TO AN END’
"In the end, the reality will come out, and this will turn out to be, of course, one of the landmark historical events that I so value in history looking back," Grantham continued. "It will be amazing, by the way, if it doesn’t collapse, because it will need such massive developments on AI that our entire lives are totally different."
GMO founder Jeremy Grantham warns that investors "will be laughing at" SpaceX's stock valuation in the future. (Getty Images)
SpaceX made its IPO debut on June 12, and began trading at $150 a share, above its listing price of $135 a share. As of midday Wednesday, the stock hovered around $149 per share and was down nearly 7% month-to-date.
Goldman Sachs, JPMorgan and Morgan Stanley have posted bullish forecasts for SpaceX's valuation, Fortune reported, with price targets ranging from $205 to $300 per share.
Grantham also criticized Wall Street's advice for clients to buy SpaceX, adding that even if the market ultimately validates the elevated share price, society will become a "strange one" where "we’ll be lucky not to be bossed around by our automaton friends."
SpaceX's quick addition to the Nasdaq-100 Index has affected its stock performance, with Grantham also saying, "What that means is there’ll be a lot of people who have to buy it for any index that is Nasdaq-y. So there’ll be much more demand than there are sellers."
"So supply and demand being what it is, it’s hard to imagine the price won’t go up, and perhaps it will go up a lot," Grantham said.
SpaceX's IPO raised $75 billion and was the largest IPO in history, surpassing Saudi Aramco's $29 billion IPO in 2019.
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The IPO cemented Musk's status as the world's richest person, pushing the value of his holdings toward $1 trillion, a milestone no individual has previously reached.
Founded by Musk in 2002, SpaceX has grown into the world's largest space company and a dominant force in commercial launch services. The company pioneered reusable rocket technology, helping lower launch costs and reshape the economics of the space industry. It has also become a key contractor for NASA and the U.S. government through civil and national security missions.
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FOX Business’ Eric Revell and Bradford Betz contributed to this report.
Space Exploration Technologies (SPCX +1.82%) went public last month, and out of the gate, it was red hot, rising to nearly $226 -- a big increase from the $150 it opened at on its first trading day. Since then, however, the stock, which more commonly goes by just SpaceX, has been falling, and on Tuesday it was back to around the $150 mark again.
The stock has effectively given back those early gains, virtually assuring that just about anyone who bought in those early days is in the red. Has the excitement already faded for the stock, and could it be headed for more of a decline, or is now a good opportunity to buy SpaceX?
Image source: Getty Images.
Trading volumes have come down significantly There was huge interest in SpaceX when its shares began trading nearly a month ago. The new public offering was eagerly anticipated, and investors were looking for ways to gain exposure to the space company even before its shares began trading, including by investing in stocks that had positions in SpaceX. Trading levels were through the roof, but there's clearly less excitement around the stock these days, as volumes have dropped considerably in the past few weeks.
SPCX Volume data by YCharts
Naturally, there will be a bit of a decline after the initial rush to buy an initial public offering. However, with the decline in both the share price and trading volume, it could very well be an indication that investors are beginning to think a bit more carefully about the stock, particularly since its valuation is astronomical. Although it has come down in price, SpaceX stock still trades at around 110 times its trailing revenue.
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SpaceX stock still isn't worth buying Many investors were eager to buy SpaceX stock regardless of how obscene and illogical its valuation was when it began trading, and are now facing losses that could grow even bigger as the stock may still have more room to fall. This is, after all, an unprofitable company, and while it has grand visions for travel to Mars and putting data centers into space, those are highly ambitious objectives that may take many years to become reality, assuming the company can come through on them at all.
SpaceX is the only stock that has a $2 trillion valuation or more, and that doesn't have a highly profitable and successful business. That math on its valuation just doesn't work, and investors who buy without taking that into consideration could incur mammoth losses. The stock's decline may just be getting started.
Key Takeaways SPCX fell 6.8% on its Nasdaq-100 debut, closing at $149.47, its lowest level since IPO.Starlink, Starship and AI infrastructure plans are key growth engines for SpaceX's long-term story.SpaceX's $2T valuation and 36X forward sales multiple leave little room for execution missteps. Shares of Space Exploration Technologies (SPCX - Free Report) fell 6.8% yesterday on their first day as part of the Nasdaq-100 Index, closing at $149.47. The stock is now trading at its lowest level since its June 12 IPO and well below its closing high of $211.39.
SpaceX became one of the fastest companies to join the Nasdaq-100, but the milestone failed to provide the boost many investors had expected. Instead, the stock came under pressure as a broad technology selloff weighed on the sector.
The weakness was due to growing concerns over heavy AI-related spending, rising U.S. bond yields, higher oil prices and escalating tensions in the Middle East. Several technology stocks, including Marvell Technology (MRVL - Free Report) , Micron Technology (MU - Free Report) and Advanced Micro Devices (AMD - Free Report) , also declined sharply yesterday.
Yesterday’s Price Decline Image Source: Zacks Investment Research
With SpaceX now trading near its post-IPO lows, the key question is whether the recent pullback offers a compelling buying opportunity or signals further downside ahead.
Multiple Growth Engines Support SPCX’s Long-Term StorySpaceX's long-term growth story remains compelling, supported by multiple high-growth businesses.
The biggest growth driver is Starlink, SpaceX’s satellite Internet arm. It is benefiting from rising demand for broadband connectivity in underserved regions and is positioned to offer text, voice and data services directly to standard smartphones. The business generated more than $11.4 billion in revenues and $4.4 billion in operating income in fiscal 2025, highlighting its ability to generate meaningful profits while expanding globally.
Another major catalyst is Starship. Following its 12th successful test flight in May 2026, the next-generation launch vehicle is expected to carry much heavier payloads than Falcon 9. This would enable the deployment of larger Starlink satellites while significantly reducing the cost of delivering satellite bandwidth, improving the economics of the Starlink business over time.
SpaceX is also transforming into an AI infrastructure company following the acquisitions of xAI and X earlier this year. By combining AI models, large-scale computing infrastructure and satellite connectivity, the company is building an integrated platform that few competitors can match. It plans to launch AI compute satellites by 2028, paving the way for space-based data centers.
The company's growing presence in AI is already attracting major customers. Multi-billion-dollar computing agreements with Alphabet's Google and Anthropic provide long-term revenue visibility, while the planned acquisition of Anysphere, the company behind the AI coding assistant Cursor, strengthens its position in the fast-growing enterprise AI software market.
But Can We Look Past the Valuation Concerns?While SpaceX's long-term opportunities are significant, its valuation leaves little room for disappointment.
The company is currently valued at around $2 trillion despite generating just $4.69 billion in first-quarter revenues and incurring a net loss of $4.28 billion. On a forward 12-month basis, the stock trades at roughly 36 times sales, a rich premium even among high-growth technology companies.
Image Source: Zacks Investment Research
Investors are paying for what SpaceX could become rather than what it is today. That optimism rests on Starlink's continued expansion, AI infrastructure, space-based data centers and Elon Musk's vision of building a company capable of generating $100 billion in annual revenues by 2028.
However, reaching that milestone will require flawless execution across multiple capital-intensive businesses. Also, history suggests that investors should treat Musk's timelines with caution. We know that many of Tesla's ambitious projects, including robotaxis and humanoid robots, have taken longer than initially projected. Likewise, many of SpaceX's biggest growth initiatives are still years away from making a meaningful financial contribution and will require huge investment before they begin generating attractive returns.
Is SpaceX Stock a Buy?SpaceX remains one of the most compelling long-term growth stories in the market. Few companies have leadership positions across commercial space, satellite connectivity and AI infrastructure, giving SPCX multiple avenues for expansion over the coming decade.
That said, much of this optimism already appears reflected in the stock's premium valuation. Even after the recent pullback, investors are still paying a steep price for future growth that will take years to materialize.
Having said that, for existing shareholders, the recent decline does not change the long-term investment thesis, making the stock worth holding through near-term volatility. Wall Street's average price target still implies roughly 35% upside from current levels.
Image Source: Zacks Investment Research
However, new investors may be better served by waiting for a more attractive entry point. While SpaceX's long-term prospects remain attractive, the current valuation still offers a limited margin of safety, leaving little room for execution missteps or broader market weakness.
SPCX stock currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
When SpaceX (SPCX +0.56%) was preparing for its IPO, Morningstar analysts warned investors that the best buying opportunity may not occur immediately.
"We value SpaceX at $63 per share, a 53% discount to the upcoming IPO price," the firm stressed. "Our valuation is the result of mathematics more than skepticism, reflecting a wide range of possible outcomes for the company's financial future."
Ultimately, Morningstar suggested that investors pass on buying into the IPO.
"We think the company has been significantly overvalued and investors will have opportunities to buy the stock at more attractive levels after the IPO," the firm concluded.
While SpaceX stock hasn't quite fallen to its initial IPO price of $135 per share, a steep correction has given investors an opportunity to buy in at a hefty discount to the company's post-IPO highs. Investing now could be a wise decision long term for one key reason.
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Here's why SpaceX stock is attractive after the correction If you're looking to bet on AI, few stocks are as uniquely positioned as SpaceX. Many believe the company to be a rocket maker. And it is. The company's Falcon Heavy rocket has successfully launched more than 600 times, bringing an unprecedented number of payloads to space quickly and relatively cheaply.
But rockets are simply a means to an end for SpaceX. The company, after all, used its rockets to launch its Starlink internet service -- a segment that';s posting positive gross margins and impressive revenue growth rates.
The most lucrative use of SpaceX's rockets long term, however, will be for launching data centers into space -- so-called orbital data centers.
Image source: Getty Images
Experts are split on whether orbital data centers are even possible from an economics and physics standpoint. But SpaceX is perhaps the only company on Earth today positioned to make them a reality.
The idea here is simple: AI could become one of the largest markets in human history. That will only be possible if there are enough data centers to run the computing capacity required for a globally scaled AI economy. Thus, more data centers need to be built.
The problem is that data centers are resource intensive, using massive amounts of land, water, and energy. Putting them into space, at least on paper, has the potential to alleviate most of those terrestrial challenges. With a Starlink connectivity network already in place, SpaceX can easily connect these orbital data centers to ground-based relay centers.
Ark Invest, a major SpaceX shareholder, believes SpaceX could generate $300 billion in annual revenue by the end of this decade by renting computing power from orbital data centers. If that comes to pass, suddenly SpaceX's $2 trillion market cap becomes much more palatable.
It remains to be seen whether SpaceX can actually pull off this major growth opportunity. But the potential is clearly there. And investors looking to go all in on AI stocks should put SpaceX at the top of their watch list.
With Space Exploration Technologies (NASDAQ:SPCX) touching down on the Nasdaq 100, it’s no longer a wash when investors are choosing between the S&P 500 and Nasdaq 100. Undoubtedly, there’s a lot of overlap between the two indices, but the Nasdaq 100 takes the mega-cap tech exposure to another level entirely.
With the S&P 500 holding off on adding SpaceX so soon after its IPO, allowing enough time for seasoning and a shift into profitability, questions linger as to whether the Nasdaq 100’s allocation to SpaceX will beckon investors who would have otherwise put money in an S&P 500 ETF.
Indeed, for younger investors who don’t mind added volatility for a shot at greater growth, the answer is simple. Any way you look at it, the Nasdaq fast-track is a big win that not only further differentiates it from the S&P 500 but might just cause some to view the tech-heavy index as the new go-to index to bet on the broad markets.
The Nasdaq’s SpaceX fast-track just changed the passive investment game After all, with SpaceX going for a market of around $2 trillion, it’s quite the needle mover that’s in the league of the Magnificent Seven. And if Elon Musk can deliver, there’s no telling how much further up the ranks the firm can fly. Who knows? If orbital data centers are the future of AI compute, perhaps it’s not all too far-fetched to envision SpaceX rising to become the world’s largest company.
Of course, there’s a lot of promise, and only time will tell if the company can continue its ascent now that it’s landed on public markets with a fairly hefty price of admission.
Arguably, the company could smash past earnings and still move lower, given the frothy valuation and broad distaste for AI-related CapEx, something I outlined in prior pieces. In any case, the choice between the S&P 500 and Nasdaq 100 might ultimately come down to whether one wants a piece of SpaceX.
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SpaceX’s road to a $10 trillion market cap? Indeed, there are tremendous downside risks, but, at the same time, the fear of missing out (FOMO) is a powerful force. And there’s no telling where shares of Space Exploration Technologies could go if orbital data centers and next-generation AI help the firm grow to become a $10 trillion company.
With some of the biggest bulls on Wall Street looking for the shares to surpass the $400 per-share mark, perhaps the biggest risk for younger investors with time on their side is not getting that piece of SpaceX in these earlier, riskier days.
Of course, one could always just buy the S&P 500 with some shares of SpaceX on the side. But, for the most part, I do think the Nasdaq 100’s decision to fast-track Elon Musk’s space titan is a winning move that could help it gain a leg up over the S&P 500, especially as the AI rally goes into overdrive and the revolution enters a monetization phase.
The tech-heavy Nasdaq is about to become tech-heavier In my view, the Nasdaq 100 suddenly became that much more exciting than the S&P 500. For those looking for the new economy plays rather than a more diversified mix with a greater emphasis on profitability, I think the Nasdaq 100 may very well be the “new” default investment option for a generation of new investors who want to go for growth. Indeed, perhaps a bit of added volatility is worth stomaching if it means owning a piece of the future economy.
In other words, embracing greater choppiness to skate towards where the puck is headed next. Time will tell if the SpaceX fast-track benefits Nasdaq 100 holders or not, but either way, the AI IPO wave to come makes the paths forward for the S&P and Nasdaq 100 look vastly different. Does one gravitate towards the explosive, hyper-growth firms earlier on? Or wait until they’re seasoned and de-risked enough?
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Just weeks after its initial public offering, Space Exploration Technologies (SPCX 6.83%), aka SpaceX, announced a major acquisition. The Elon Musk-founded space exploration and artificial intelligence (AI) company announced a further pivot toward the latter trend with its plans to acquire Anysphere, the developer of AI coding platform Cursor, in a $60 billion all-stock deal.
So far, this announcement has had a limited impact on SpaceX's stock performance. Shares were pulling back around the announcement and just after, but have started to bounce back of late. Let's take a closer look and see what a deal could mean for SpaceX, which is arguably as much an AI stock as it is a space stock.
Image source: Getty Images.
Why SpaceX "had" to buy Cursor After exercising an option back in April, before it went public, SpaceX became obligated either to acquire Anysphere for $60 billion or else pay it a $1.5 billion termination fee and provide it with $8.5 billion in computing resources.
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But while SpaceX may have been more or less "obligated" to buy Cursor, the price tag may be far more reasonable than it appears at first glance. Given the rich valuation of SpaceX stock, even after its pullback, financing this as an all-stock deal costs existing investors fairly little in terms of dilution. Even if SpaceX prices the Cursor acquisition at its current stock price of around $164 per share, rather than the $200 per share or more it was trading at last month, that would mean a 365.9 million increase in the share count.
Considering SpaceX's current diluted share count of just under 13.2 billion, this means dilution of less than 3%. Having said that, while Cursor's acquisition price may seem like small potatoes compared to the company's more than $2 trillion valuation, it could have a tremendous impact on SpaceX's status as an AI contender.
A potential game changer, but it's still early Once the acquisition closes later this year, SpaceX can begin integrating Cursor's AI coding tool into its own xAI platform. In turn, this could make xAI a more formidable contender against competitors such as Anthropic's Claude and OpenAI's ChatGPT. Still, while it's a potential game changer, expect this deal to have a limited impact on the narrative for now.
Why? For one thing, the deal's closing is months away, after which it will take time for SpaceX to integrate Cursor into its existing xAI ecosystem. Like other AI start-ups, Cursor also remains unprofitable. In the immediate term, this business will only add to SpaceX's overall losses. Moreover, even as this platform is one of the main names in the AI coding space and currently has reached over $2 billion in annual recurring revenue, the competition is heating up as rivals like Anthropic scale up their own AI coding products.
In light of all this, count on catalysts related to other key SpaceX assets and projects, like Starlink and Starship, to have a greater impact on the stock's performance for a while. Right now, SpaceX remains extremely pricey, trading at over 820 times estimated 2027 earnings. As such, you may want to wait for shares to become much cheaper or for further bullish developments to emerge before you consider buying.
On July 7, Space Exploration Technologies (SPCX 6.72%) joined the Nasdaq-100 -- which is the 100 largest non-financial companies by market cap listed on the Nasdaq stock exchange. It also received a $300 price target from Morgan Stanley, one of the Wall Street banks that underwrote SpaceX's initial public offering (IPO).
Being a part of a major index is more than just name recognition. Exchange-traded funds (ETFs) benchmarked to the Nasdaq-100, such as the Invesco QQQ Trust (QQQ 1.85%), will begin buying shares of SpaceX. The more indexes a company can be a part of, the more demand is unlocked from ETF inflows -- the crown jewel being the S&P 500 (^GSPC 0.45%), because the largest ETFs in the world are linked to it.
Here's why SpaceX was added to the Nasdaq-100 so quickly, and why the growth stock is falling anyway.
Image source: Getty Images.
SpaceX will soon be a top holding in the Nasdaq-100 The Nasdaq's new fast-track rules are meant to expedite the inclusion of megacap companies that recently had IPOs. If a company is at least as valuable as the 40th-largest Nasdaq listing, which is a market cap of around $121 billion, it can now be added to the Nasdaq-100 after its 15th trading day. SpaceX has a market cap of around $2 trillion and is the world's seventh-most valuable company -- so it clears the size hurdle with ease.
SpaceX went public on June 12, but markets were closed on Juneteenth (June 19) and July 3. So, it wasn't added to the Nasdaq-100 until over three weeks after its IPO. However, SpaceX's weight in the Nasdaq-100 isn't its market cap. Rather, it is based on a multiple of the float, which is the number of shares available for trading by the public. SpaceX's float is around just 5% of its market cap. But the float could increase rapidly in the coming months.
The vast majority of SpaceX stock is held by insiders who bought in when the company was private -- including institutional investors from previous funding rounds, employees, and founders. SpaceX plans to gradually unlock early-release-eligible shares through a tiered system over the next 180 days, with 20% of shares available for trading two days after the release of its earnings for the quarter ended June 30, and up to 30% if SpaceX's stock price is at least $175.50 per share.
More key unlocking events will occur throughout the summer and fall. And eventually, 100% of the early-release shares will be available for trading by Dec. 9 -- which is 180 days after the IPO date.
Granted, not all insiders will sell their shares and make them available for trading on public markets. Elon Musk and other significant investors have agreed to hold shares for at least 366 days after May 20, the date of SpaceX's Form S-1 filing with the Securities and Exchange Commission. And many early founders still hold large positions in major tech companies, such as Musk in Tesla or Jeff Bezos in Amazon.
Before the recently implemented fast-track process for larger IPOs, the Nasdaq-100 required a free float of at least 10%, meaning at least 10% of the company's shares are publicly tradable. SpaceX should cross that level even if a fraction of early-release-eligible shares are sold and made available on the Nasdaq in the coming months. If I had to guess, I'd expect SpaceX's weighting in the Nasdaq-100 to mirror its market cap by mid-August at the latest.
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The market is always evolving Once SpaceX is weighted by market cap, it will be a top-10 holding in the Nasdaq-100 and account for around 4% of the index. And as more blockbuster IPOs like Anthropic and OpenAI are fast-tracked into the index and reach the float requirements, they, too, could become key holdings. The rapid restructuring of the Nasdaq-100 has undoubtedly piqued the interest of index and ETF investors, especially those who regularly put their hard-earned savings to work in products benchmarked to the indexes.
A common mistake investors will make is assuming that an index is diversified just because it contains hundreds or thousands of stocks. When in reality, the Nasdaq-100 and S&P 500 have become concentrated in a handful of names. And that concentration could increase as megacap IPOs are added.
To stay even-keeled no matter what the market is doing, it's important to heed Peter Lynch's advice about knowing what you own and why you own it. That exercise is straightforward with individual stocks, where an investment thesis can anchor a key holding. But even for ETFs, it's worth recognizing some of the major themes and companies that will drive gains (or losses).
By design, the major indexes can undergo drastic transformations as the economy evolves. A couple of decades ago, major oil companies, industrial conglomerates, and consumer goods companies dominated the largest S&P 500 and Dow Jones Industrial Average (^DJI 0.25%) companies. But the tech sector now makes up a staggering 38% of the S&P 500. And Alphabet just replaced Verizon Communications in the Dow -- meaning that seven of the 30 Dow components have changed seats in the last six years.
SpaceX will continue making waves on public markets SpaceX's growing share of the indexes and lofty price targets from Wall Street banks have more to do with market dynamics than SpaceX's investment thesis. The recent sell-off in the stock is likely due to fading enthusiasm as investors focus more on SpaceX's fundamentals -- which are shaky given its valuation is in the stratosphere.
For the stock to be a good long-term buy for new investors, SpaceX needs to make progress on its bold plans to launch constellations of orbital artificial intelligence compute satellites and build the world's largest chip manufacturing plant in Texas in partnership with Tesla. Until that happens, SpaceX is best kept on a watch list. And investors who want to avoid the stock entirely may want to double-check that the ETFs they hold don't begin buying SpaceX, especially as its float increases in the coming months.
Picture a 68-year-old retired engineer outside Columbus. He collects about $2,400 a month from Social Security, has roughly $900,000 in a traditional IRA, and most of that money sits in a Nasdaq-100 index fund he has held for a decade. He does not plan to touch the IRA until the government forces him to.
Then a news alert crosses his phone. SpaceX (NASDAQ:SPCX), most recently carrying a market cap near $2.0 trillion, has been folded into the Nasdaq 100. His index fund quietly rebalances into it, and his IRA balance ticks higher. On one hand, that feels like positive news. On the other, it also sets up a tax bill he has not planned for.
Retiree threads on investing forums keep circling this same worry. One recent post asking whether “the math isn’t mathing on the SpaceX IPO” pulled in more than 2,700 upvotes from readers wondering what a mega-cap addition means for retirement accounts. For someone five years away from required minimum distributions (RMDs), the answer matters more than most people realize.
The Detail That Actually Drives His Tax Bill Required minimum distributions begin at age 73 under current law. The IRS takes his prior year-end IRA balance and divides it by a life-expectancy factor of roughly 26.5 at age 73. A bigger balance means a bigger forced withdrawal, taxed as ordinary income.
Here is where Social Security enters. Once the RMD stacks on top of his other income, the IRS calculates provisional income. For a single filer, provisional income above $25,000 makes up to 50% of Social Security benefits taxable; above $34,000, up to 85% becomes taxable. Those thresholds have sat still since the 1990s and are not indexed to inflation.
Concrete outlook: if a Nasdaq rally lifts his IRA from $900,000 to $1.1 million by the year he turns 72, his first RMD grows by roughly $7,500. On $28,800 a year in benefits, moving from the 50% zone into the 85% zone can add several thousand more in taxable income he did not have the year before. The rally he cheered at 68 silently cost him at 73.
The Nasdaq 100 already ran up almost 18% year to date, so the balance inflation is not hypothetical.
How the Pieces Connect That same larger RMD can also cross a Medicare IRMAA threshold. IRMAA uses a two-year lookback, so income reported at 73 sets Part B and Part D premiums at 75. One dollar over a tier can add several hundred dollars a year in surcharges.
The five-year window between the ages of 68 and 73 is where most of the real magic happens. Inside a traditional IRA, he can rebalance out of a concentrated Nasdaq position without owing a penny in capital gains, because trades inside the IRA are not taxable events. He can also convert slices of the IRA to a Roth in lower-income years, paying tax now at a known rate to shrink the balance the RMD formula will eventually work from. Starting at 70.5, qualified charitable distributions can satisfy part of the RMD while keeping adjusted gross income lower.
What to Think Through Before 73 A few decisions in this window carry more weight than the rest, and they only work if he acts while he still has years to spend.
The mistake hardest to undo is coasting through the pre-RMD window. Once distributions start, the balance is what it is, and the tax torpedo fires on schedule. Partial Roth conversions in his late 60s and early 70s are the main lever, and they only work if he uses the years he still has. Every dollar of growth in a traditional IRA is pre-tax growth. When a name like SpaceX helps push the whole index higher, the government becomes a silent co-owner of that gain, and the bill lands through RMDs, Social Security taxation, and IRMAA at roughly the same time. Everyone’s numbers land differently, and a single detail like filing status, a pension, or a working spouse can flip which lever matters most. A short conversation with a tax-focused advisor before the first RMD year is usually the cheapest money a retiree ever spends. None of this makes SpaceX’s addition to the index a bad thing. A stronger index is good news for anyone holding it. The point is simply to make sure the growth works as hard for the retiree as it does for the tax code.
Contact [email protected] for any questions or corrections.
SpaceX stock dropped 6.8% on Tuesday after being added to the Nasdaq-100 Index. (Michael Nagle/Bloomberg)
Valuing Elon Musk’s rocket and artificial-intelligence company SpaceX might be as hard as developing reusable rockets. But with a bevy of new research reports, investors can see how Wall Street approaches the problem.
For all the hype surrounding the SpaceX (NASDAQ: SPCX) initial public offering (IPO) and the company’s launch valuation, even investing $100 as soon as possible would have proven a middling investment.
Specifically, SPCX shares were originally offered at $135 and are, at press time on July 8, trading at $149.52 following a 0.033% extended session rise. Under the circumstances, a $100 investment made already at the IPO would have risen to $110.76 for a $10.76 profit.
SpaceX stock price one-week chart. Source: Google Investors who got their hands on SpaceX stock at the beginning of the equity’s first trading day – June 12 – would have seen their position remain effectively flat, while those who purchased on that evening would have lost $7 as the company ended the day at $160.95.
Still, both groups would have been far more fortunate than those who took Jim Cramer’s amazement at the rally as a sign to buy – thus also joining Representative Dan Meuser – and purchased close to the all-time high (ATH) of $225.64.
Indeed, such investors could only be pleased that they hadn’t invested $5,000 or $10,000 in the stock as SPCX shares retraced 33.74%, meaning that $100 would have turned into $66.26 for a $33.74 unrealized loss.
What is next for SpaceX stock price in 2026 Elsewhere, the future of SpaceX appears increasingly uncertain at press time on July 8. Since the IPO, the company’s extreme launch valuation of $1.77 trillion, paired with revenue below $5 billion and the fact that the firm is operating at a loss, presented a substantial long-term risk factor.
More recently, investors might have found themselves alarmed by the fact that SPCX shares failed to see a significant rally even after their official inclusion into the Nasdaq-100 – though it will likely take some time for buying pressure from index funds to be fully reflected in the market.
Nonetheless, even if a renewed rally begins in July as many have been expecting since before the SpaceX launch, the company’s generous unlocking schedule for wealthy insiders could reverse Elon Musk’s corporate rocket once more in August or September.
Featured image via Shutterstock
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Space Exploration Technologies (SPCX 6.83%), aka SpaceX, has quickly become one of the most noteworthy stocks to hit the market in some time. The rocket launch, satellite communications, and artificial intelligence (AI) company saw insatiable demand ahead of its public debut. Despite raising $85.7 billion, the offering was more than four times oversubscribed, according to reports. Put another way, demand was more than four times the available shares.
It's easy to understand why. Investors are looking to get in on the ground floor of a once-in-a-generation company and ride the stock to new heights. After creating reusable rockets, SpaceX has plans to launch data centers into space, which could potentially be a game changer.
One Wall Street analyst called SpaceX "one of the defining industrial infrastructure companies of the 21st century," with more than 400% potential upside, which would push its market cap to more than $10 trillion. Let's take a look to see if he's right.
Image source: Getty Images.
Raymond James says SpaceX is a buy Raymond James analyst Brian Gesuale initiated coverage on the stock with a strong buy rating and a Street-high price target of $800. That represents potential gains of 435% for investors compared to Tuesday's closing price.
The analyst believes the commercialization of space travel, combined with the vast potential of AI, is driving "the most significant infrastructure convergence since the advent of the Internet."
The linchpin of Gesuale's bullish thesis is the potential for Starship -- the company's next-generation spacecraft -- to democratize the transport of cargo into orbit. He calculates that Starship will reduce the cost of transporting goods into space by 99%, while increasing payloads "by an order of magnitude."
The analyst draws parallels to other phases of the industrial revolution, including electricity, railroads, and the internet. Starship will be the catalyst that transforms SpaceX "into a transportation network defined by commercial aviation-like operating cadence and continuously declining unit costs."
Gesuale highlights what he calls SpaceX's "powerful infrastructure flywheel," pointing out that its original rocket -- Falcon -- funded its Starlink internet satellite constellation, Starlink is funding the development of Starship, and "Starship enables the next generation of platforms."
The analyst crunched the numbers and estimates SpaceX's revenue will grow from $38.5 billion to $837 billion, a nearly 22-fold increase, while earnings before interest, taxes, depreciation, and amortization (EBITDA) will soar more than 39 times from $17.7 billion to $696 billion.
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Is the analyst right? The analyst's thesis is sound, in theory -- but there's a catch. This flywheel he references only works if SpaceX successfully develops a completely reusable Starship -- and that's a big "if." The heavy rocket is still in development, recently completing its 12th test flight, and there's no "official" timeline for completion.
The other wildcard is the ability to successfully deploy data centers in space. Some experts have highlighted the massive engineering hurdles ahead, including orbital data center design, chips hardened against radiation, and lasers powerful enough to beam the data back to Earth. Failure to achieve any of these critical designs could scuttle SpaceX's future success.
Don't take my word for it. Citi analyst John Godyn has a buy rating and a $200 price target, but has outlined a scenario in which the stock could reach $900. However, that goal is only possible if SpaceX can demonstrate "key engineering milestones" at scale.
If you think nothing can go wrong, I refer you to Tesla's repeated delays in delivering its unsupervised full self-driving capability. CEO Elon Musk originally predicted full autonomy by 2018, with 1 million robotaxis on the road by mid-2025 -- and investors are still waiting.
Don't get me wrong: The potential is certainly there -- and I wouldn't bet against Musk -- but the reality is complicated. It will take plenty of things going right for the analyst's thesis to play out, and only one thing going wrong to scuttle it.
It's also worth noting that with trailing-12-month revenue of $19.3 billion, SpaceX is selling at 102 times sales and roughly 42 times expected 2026 sales. That's a pricey valuation for a company that still faces significant hurdles.
Item 1 of 3 A model of the lunar lander "Resilience", operated by 'ispace', is displayed at a venue where employees of 'ispace' monitored its attempted landing on the Moon, in Tokyo, Japan, June 6, 2025. REUTERS/Manami Yamada/File Photo
[1/3]A model of the lunar lander "Resilience", operated by 'ispace', is displayed at a venue where employees of 'ispace' monitored its attempted landing on the Moon, in Tokyo, Japan, June 6, 2025. ... Purchase Licensing Rights, opens new tab Read more
TOKYO, July 8 (Reuters) - Japanese moon transport company ispace (9348.T), opens new tab said on Wednesday it would start a new, lower-cost lunar cargo business using the Starship heavy rocket and moon lander developed by Elon Musk's SpaceX (SPCX.O), opens new tab.
Tokyo-based ispace has bought 500 kg (1,102 lb) of capacity for $50 million on a Starship that would land on the moon as soon as 2030, and will build a lunar surface vehicle that can host payloads from clients worldwide sharing their ride on Starship to the moon, it said.
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The new "lunar access integrator" service provides moon-bound "buses" and can complement ispace's ongoing development of dedicated lunar landers, or "taxis", to the moon's surface, said ispace Executive Vice President Hideari Kamiya.
On previous trips to the moon, ispace used SpaceX's Falcon 9 rockets for unsuccessful lunar touchdown attempts in 2023 and 2025.
The Tokyo-based company now aims to soft-land three landers, called Ultra, onto the moon by 2030, including a mission that is part of NASA's Commercial Lunar Payload Services programme.
While ispace carries on its Ultra missions, the tie-up with SpaceX will "exponentially" accelerate its growth in the lunar infrastructure market, Chief Executive Takeshi Hakamada said.
SpaceX welcomed the expansion of its relationship with ispace to fly missions on Starship, a reusable transportation system which, unlike Falcon 9, includes a spacecraft that Musk's company plans to take to the moon and eventually to Mars.
"Their integration services provide a valuable pathway for smaller payloads to secure a ride to the Moon today, and we look forward to supporting ispace and their customers as they help expand access to the lunar surface," Stephanie Bednarek, SpaceX's vice president of commercial sales, said in a statement.
The relationship is not exclusive. NASA plans to use Starship's first lunar landing in 2028 as part of its Artemis program to send astronauts back to the moon. U.S. lunar rover startup Astrolab has also booked space on a future Starship flight.
"SpaceX approached us first" with the integrator business idea, Hakamada said.
"While we can't rule out other companies entering the market, few might be able to integrate cargo and keep providing services after touching down on the moon."
Reporting by Kantaro Komiya; Editing by Sonali Paul
Our Standards: The Thomson Reuters Trust Principles., opens new tab
Kantaro writes about the burgeoning space industry and a wide range of breaking news stories in Japan. A Tokyo native, he was the recipient of the Overseas Press Club Foundation 2020 Scholar Award.
Equity investors love SpaceX. The bond market, however, is a bit more skeptical.
The initial public offering (IPO) of Space Exploration Technologies (SPCX 6.83%) last month was a nearly unprecedented stock market phenomenon. The IPO was four times oversubscribed due to strong institutional and retail demand. The stock opened its first day on the market trading at $150, and in the days that followed, it surged to an intraday high of more than $225. Since then, it has settled back down, and even briefly sank below that $150 level. As of late Monday afternoon, it was trading at around $157 per share, giving the company a market capitalization of more than $2 trillion.
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That keeps Elon Musk's aerospace and artificial intelligence (AI) firm among the 10 most valuable companies in the world.
So, while SpaceX is still deeply unprofitable and probably will be for some time, investors expect strong profits down the road. But the bond market sees things a bit differently.
SpaceX's bonds are not investment grade The company's bonds are trading at an average 1.62-percentage-point premium over Treasuries, a credit spread that puts it in the BB category.
For those unfamiliar with bond ratings, BB corporate bonds trade at an average spread of 1.55 percentage points. The wider the spread, the worse the rating. And BB bonds are technically non-investment grade. The fall into the range also known as "high yield" or "junk."
This is because BB-rated bonds are viewed as carrying a substantial credit risk for their holders. While investment-grade bonds have a historical default rate in the range of 0% to 1.02%, the default rate for BB-rated bonds has been about 4.22%, or four times higher than that of the riskiest investment-grade bonds.
And SpaceX carries a substantial debt load, about $29 billion in long-term bonds.
Image source: Getty Images.
What does that mean for SPCX investors? Well, I think it means that they may be a bit too enthusiastic about the company.
To be sure, SpaceX has a profitable business in Starlink, its satellite internet service. That service generated about 60% of the larger company's $18.7 billion in revenue last year.
But SpaceX's AI division, which also includes social media platform X (formerly Twitter), posted an operating loss of $6.4 billion last year. And SpaceX as a whole posted a $4.9 billion loss for the year.
Of course, when you buy a stock, you are buying rights to a share of its future profits, if there are any. In the case of SpaceX, investors believe those profits could be massive, partly because of Musk's grand visions for it.
The company's initial registration form, filed with the Securities and Exchange Commission before the IPO, claims among its missions "to make life multiplanetary," "to understand the true nature of the universe," and "to extend the light of consciousness to the stars." It also said, "to harness the Sun to power a truth-seeking artificial intelligence that advances scientific discovery and, ultimately, to build a base on the Moon and cities on other planets."
I'm not saying Musk won't make progress toward some of those lofty goals, but the bond market is hedging its bets.
Space Exploration Technologies (SPCX 6.83%) attracted a lot of buzz heading into what became the largest IPO in the stock market's history. Elon Musk became the world's first trillionaire, and some investors want to ride the momentum.
While investor enthusiasm has helped the stock stay above its $135 IPO price, it's down more than 30% from all-time highs, and losses could continue to widen from here.
Image source: Getty Images.
The valuation doesn't make sense SpaceX is currently worth more than $2 trillion but generated only $4.69 billion in first-quarter sales. Assuming SpaceX maintains that quarterly revenue rate for the entire year, the stock is easily looking at a price-to-sales ratio above 100.
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And the company is still burning through money. SpaceX reported a $4.28 billion net loss in the first quarter, underscoring the need to raise funds through its IPO and bond sales.
SpaceX gets its high valuation due to Starlink, the potential for data centers in outer space, and, most importantly, Musk himself. The eccentric entrepreneur believes SpaceX can reach $100 billion in annual revenue by 2028.
Some contracts with tech giants support that possibility. SpaceX reached a multi-year deal with Alphabet that will average to $920 million per month, starting in October. SpaceX will provide AI infrastructure, such as GPUs, CPUs, and memory chips. It also reached a three-year deal with Anthropic that almost reaches $45 billion. Anthropic's deal includes at least 300 megawatts of computing capacity at SpaceX's Memphis data center, with capacity at a second facility as well.
The combined value of those contracts stands at approximately $26 billion per year. A few more contracts like these make the $100 billion figure more realistic, but it's not guaranteed and can take a while.
But for now, SpaceX's valuation is in another orbit from Tesla's valuation. Tesla receives complaints that it is an overvalued stock, yet its 15.4 price-to-sales ratio is much lower than SpaceX's.
Excitement is masking bad fundamentals It's entirely possible that SpaceX reaches $100 billion in annual revenue by 2028, but what if it doesn't? The forecast anticipates that SpaceX will increase its revenue more than twentyfold in less than three years. Even if SpaceX achieves the milestone with Starlink and AI compute contracts, it won't mean as much if net losses continue to accumulate.
The path to $100 billion in annual revenue in such a short time requires perfect execution. While Musk is a brilliant entrepreneur, he has been known to set overly ambitious goals that don't always pan out. We were supposed to see 1 million robotaxis and operational hyperloops by 2020 and a Martian colony by 2024. If Musk's SpaceX projection is woefully off, it will weigh on the stock.
Setting ambitious goals can certainly help a company gain market share faster. It embraces the idea of shooting for the moon and landing among the stars if you miss. However, investors need much more clarity and certainty about a company that burns through billions of dollars each quarter and trades at a price-to-sales ratio above 100.
Musk's involvement in the company and people's desire to be on the ground floor of the next big thing are the major catalysts driving the current stock rally. Starlink's broadband internet services, terrestrial AI infrastructure, and potentially data centers in space may be major contributors in the future, but investors have to look at present fundamentals in addition to perfect-case projections.
Investors can choose from many growth stocks that have better balance sheets and revenue growth rates. Most of the next few years are already baked into SpaceX's $2 trillion valuation, even if it reaches $100 billion in annual revenue by 2028.
One of the most important discussions happening since the Space Exploration Technologies (SPCX 6.72%) initial public offering (IPO), and the one that's perhaps the most relevant to the investing community, is how the IPO impacts index investors.
While the SpaceX IPO was the largest in history and highly oversubscribed, there are plenty of investors out there (like me) who wouldn't touch it with a 10-foot pole. That gets complicated, however, because many value investors use passive index investing, whether as the main part or just one element, of their investment strategy.
Since SpaceX has landed on the market as one of the most valuable companies in the world, it's going to be added to many indexes and incorporated into funds that track them. In fact, it's already happening; it was added to the Russell 1000 index at the end of June, just two weeks after going public, and funds that track it will have to buy SpaceX stock to reflect that change. As of this writing, two Vanguard exchange-traded funds (ETFs) that track the Russell 1000, the Vanguard Russell 1000 ETF (VONE 0.52%) and the Vanguard Russell 1000 Growth ETF (VONG 1.30%), do not list it as a component.
Image source: Getty Images.
It's also being fast-tracked into the Nasdaq-100, which means the Invesco QQQ Trust ETF (QQQ 1.88%), one of the world's largest ETFs, will have to include it as well.
With two more high-profile IPOs on the way later this year, they may be changing the landscape for index investors.
Do IPOs change this low-risk investing strategy? Vanguard rates most of its index-tracking ETFs with a four-out-of-five risk rating, which seems high. Its lower risk ratings, though, go to bond ETFs. The higher-risk stock ETFs get a five. That means it sees inherent risk in nearly all of its stock ETFs, and that risk is a feature, not a bug. This may be why.
Passive index investors tend to view the strategy as a low-risk path toward wealth creation. The S&P 500 has gained an annualized average of 11.4% over the past 20 years, and investing in it through a low-cost index ETF, rather than trying to beat it, reduces the risk of owning individual stocks while providing opportunities to grow your money.
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SpaceX is already live, but under current rules, it won't be eligible for inclusion in the S&P 500 for at least another year. However, Anthropic and OpenAI are planning big IPOs later this year and are likely to become among the most valuable companies right away.
Investors have some time to consider their strategy. Weighted ETFs like the Vanguard S&P 500 ETF (VOO 0.51%) are by nature growth-oriented, and these heavy IPOs could increase their risk. Investors who rely on them for low-risk qualities may want to diversify some of their holdings into true low-risk vehicles, such as bond or value ETFs. For example, the Russell 1000 value index does include SpaceX, but since it was classified as 90% growth and 10% value, it will only account for a small amount of the Vanguard's Russell 1000 value ETF (VONV +0.20%) weight when it gets included.
The June 12 initial public offering of Space Exploration Technologies (SPCX 6.83%), better known as SpaceX, shattered the record for the largest Wall Street IPO in history. That was only the beginning of a whirlwind of events for Elon Musk's business.
Just days later, on June 16, SpaceX announced its acquisition of artificial intelligence start-up Cursor for a whopping $60 billion. Then on June 22, the company issued its first bonds, selling $25 billion worth of debt.
These activities illustrate the broader trends occurring across the technology sector. Get ready for a wild ride ahead as tech companies maneuver for dominance in the rapidly evolving artificial intelligence landscape.
Image source: Getty Images.
SpaceX demonstrates the mounting price for AI The race is on for leadership positions in the artificial intelligence era. Achieving one will be no small task, as SpaceX's recent moves indicate.
Its acquisition of Cursor demonstrates that it recognizes the importance of creating a robust AI platform -- but it also shows the high costs involved. Cursor is a software development solution built on artificial intelligence that allows users to significantly accelerate programming tasks. It's proven popular, producing over $1 billion in annualized sales last year.
SpaceX is far from alone here. Others in the tech space are rushing to snatch up AI businesses. On June 15, customer relationship management titan Salesforce announced it was spending $3.6 billion to acquire Fin, which provides an AI agent to answer customer inquiries.
Along with acquisitions, AI brings other expenses, particularly related to infrastructure. SpaceX's inaugural bond offering is part of the company's financial maneuverings to position it for the capital commitments to come.
Building and powering the vast server farms required to create and support increasingly sophisticated AI systems requires enormous levels of capital expenditures.
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The tech industry's costly AI pursuit Several businesses in the tech sector are facing the stark reality that AI infrastructure is expensive. Oracle, which provides cloud infrastructure for AI, warned, "We must incur significant capital and operating expenditures to increase our existing data center capacity." To fund its AI infrastructure build-out, Google parent Alphabet recently announced a massive $84.75 billion equity capital raise.
Tech giant Meta Platforms increased its 2026 capital expenditure projection to a range between $125 billion and $145 billion. Last year, its capex to boost its AI capabilities was $72 billion. Wall Street was taken aback by this year's prodigious spending plan, and sold off Meta shares in response. The stock was down by nearly 20% over the past 12 months through July 2.
Accelerating AI costs are hitting many tech companies, even those that aren't directly investing in infrastructure. This year, Uber blew through its annual AI budget in four months, and management is questioning whether the outcomes are worth the expense.
Uber's sentiment extended to Wall Street, where concerns over rapidly rising AI costs led to a tech sector sell-off in June. SpaceX shares, which soared to $225.64 post-IPO, crashed to $147.11 on June 23.
Until clarity emerges on whether all the AI spending is worth it, volatility is likely to persist across the technology sector. While it does, remember that the smart strategy is to keep a cool head and focus on the long-term performance of the tech companies in your portfolio, not their short-term stock oscillations.
Robert Izquierdo has positions in Alphabet, Meta Platforms, Oracle, Salesforce, and Uber Technologies. The Motley Fool has positions in and recommends Alphabet, Meta Platforms, Oracle, Salesforce, and Uber Technologies. The Motley Fool has a disclosure policy.
The temptation to go all-in on a newly public company like Space Exploration Technologies (SPCX 6.83%) that's getting lots of attention is understandable.
Media companies talk the stock up, friends and family wonder whether they should buy it, and the frenzy can lead to share price pops that perpetuate the feeling that a stock can help you strike it rich.
And yet, that's not how people statistically make the most money in the stock market.
Fidelity research shows that contributing 15% of your income over decades to a 401(k) or IRA, which earns an average annual return of about 7% to 10%, is how most people reach $1 million or more.
That may sound boring, but it's far more stable than betting on SpaceX to set you up for life. Here's why it's probably best not to expect SpaceX to make you rich.
Image source: Getty Images.
SpaceX is burning through cash with no end in sight SpaceX has some very ambitious goals, like colonizing Mars and launching AI data centers into space. The thing about doing both of those things, though, is that it's extremely expensive. The company's capital expenditures (capex) surged 86% in 2025 to $20.7 billion.
And it's not slowing down. Capex spending reached $10 billion in Q1 2026, indicating SpaceX will spend even more this year than last.
While its rocket business and artificial intelligence businesses are costing it money, there is one profitable business: Starlink. SpaceX's connectivity segment (which is made up primarily of Starlink) had about $11.4 billion in sales last year and $4.4 billion in operating income.
Unfortunately, that's not enough to offset the company's total spending, resulting in a net loss of $1.69 per share in 2025.
One of the big problems with SpaceX stock right now is that in addition to the company burning through cash and having significant losses, its shares are still very expensive. The stock has a price-to-sales (P/S) ratio of about 109 right now, compared to the tech sector average P/S ratio of 9.
So, to recap: SpaceX is making big bets on costly tech, its capex spending is ramping up, it's unprofitable, and its shares are very expensive.
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Don't bet it all on SpaceX Look, I understand the appeal of a rocket company. And SpaceX could reduce some of its costs if it achieves certain efficiencies with its Starship rockets. Some analysts project that Starship could cut launch costs by 90% or more compared to its Falcon rockets.
It's also true that SpaceX is doing a good job growing its Starlink business. It now has 12 million subscribers, up from just 2.3 million in 2022. Starlink will likely help SpaceX grow its sales over the coming years and become an even more important part of its business than it is already.
But all of that doesn't cancel out the company's high costs. Nor does it eliminate the inherent volatility most stocks exhibit after a major IPO. Decades of data show that large IPOs typically fizzle out for at least a year, with gains of less than 4% after their IPO date.
All of which means that buying SpaceX today likely won't set you up for life. And if you're tempted to buy some shares right now, it's probably best to wait until the company reports a few quarterly results to see if it's achieving its goals. In the meantime, consider taking the boring route to $1 million by contributing to a retirement account.
Space Exploration Technologies (SPCX 6.72%) has already set several records in just a few weeks as a publicly traded company.
It was the largest IPO ever, raising roughly $75 billion in its offering, and it was also the most valuable listing ever, valued at $1.75 trillion based on the listing price. It opened at more than $1.9 trillion before soaring to nearly $3 trillion briefly two sessions later.
Now, SpaceX is setting another first. It will be the fastest company ever to join the Nasdaq-100, which modified its rules to allow Elon Musk’s space company to join the vaunted index, accepting SpaceX today, less than a month after it went public.
The Invesco QQQ Trust (QQQ 1.88%), which tracks the Nasdaq-100, is one of the largest ETFs in the world with net assets of $490.1 billion. Like the index, the ETF tracks the top 100 non-financial Nasdaq stocks, and that now includes SpaceX.
Image source: SpaceX.
How SpaceX will impact the Nasdaq-100Unlike the S&P 500, which uses a straight market-cap weighting methodology, the Nasdaq-100 uses a modified market-cap weighting one, which takes a company’s float into account. The fund is allocated based on the number of publicly available shares, which makes sense since those are the only shares the ETF can buy.
Currently, only a small percentage of SpaceX stock, less than 5% of shares outstanding, is publicly traded, which means that the space stock makes up less than 1% of the Nasdaq-100 index. However, that will change over time as the company’s staggered lockup periods expire over the next year, allowing investors to sell their shares.
After a year, SpaceX could make up a significantly larger percentage of the Nasdaq-100 if insiders sell their stock and the share price goes up.
Nasdaq-100 ETFs like the QQQ are popular and have a strong track record of outperforming the S&P 500 since the dot-com era.
If you own the Invesco QQQ Trust or another Nasdaq-100 ETF like the recently launched State Street SPDR Portfolio Nasdaq-100 ETF (QNDX 1.80%), you should be mindful of SpaceX’s inclusion; however, with an allocation of less than 1%, it’s unlikely to have a significant impact on the ETF.
Still, since you now own SpaceX through the ETF, you may be less interested in buying the stock directly.
Similarly, SpaceX’s inclusion in the Nasdaq-100 is unlikely to affect the stock. Index inclusion is a net positive as it forces ETFs to buy the stock, but only $4.3 billion in passive buying was expected for SpaceX as it joins the Nasdaq-100, which is unlikely to move the stock, as it represents just about 0.2% of the stock.
Overall, SpaceX’s addition to the Nasdaq-100 won’t have a significant effect on QQQ or your portfolio, at least for now, but it's worth paying attention to what SpaceX does in the next year, both with its performance and its float, as its impact on the Nasdaq-100 is likely to grow over time.
Space Exploration Technologies (SPCX 6.83%) joins the Nasdaq-100 index on July 7, less than a month after going public. J.P. Morgan, part of JPMorgan Chase, estimates the move could create about $4.3 billion in passive buying by funds tied to the index.
Image source: Getty Images
If OpenAI and Anthropic go public at valuations even close to expected, could they also quickly enter index funds, including the S&P 500? Let's find out.
SpaceX shows the fast path into index funds The biggest catalyst is Nasdaq's new fast-entry rule. Under the updated Nasdaq-100 methodology, the largest new listings can be reviewed on their seventh trading day if their full market value ranks among the top 40 current Nasdaq-100 companies. The companies also need to meet Nasdaq's eligibility rules and have enough trading liquidity.
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Nasdaq may consider both listed and unlisted shares when determining eligibility and ranking, but the company's actual weight in the index is based only on listed shares. So OpenAI and Anthropic could go public at high valuations, but their impact on the index would depend on how many shares are actually listed for trading, not just on their total market value.
The Nasdaq-100 includes large non-financial companies listed on the Nasdaq. So OpenAI or Anthropic would probably need a Nasdaq listing to follow SpaceX's clearest fast-entry route.
Although SpaceX's fast index entry can be a short-term growth catalyst for the stock, it does not automatically make the stock safer or cheaper. Index funds buy stocks because they meet index rules, not because the business is risk-free or attractively valued.
Upcoming IPOs According to Reuters, OpenAI has already filed confidentially for its IPO and is targeting a valuation close to $1 trillion. OpenAI already has massive scale, with more than 900 million weekly ChatGPT users, more than 50 million paying consumers, and about $2 billion in monthly revenue (as of March 2026). However, the company is reportedly not expected to be profitable until 2030. Hence, although OpenAI's scale could quickly attract index attention, its long profitability timeline may keep valuation risk high.
Anthropic is also moving toward the public market. The company said it has confidentially filed its IPO paperwork. It also raised $65 billion in new funding, giving it a valuation of $965 billion in May 2026. A valuation that large could make Anthropic important to broad-market indexes soon after listing. The funding also shows how much money frontier AI companies need to keep expanding their computing capacity.
Hence, a public OpenAI or Anthropic would give index investors direct exposure to frontier AI model companies, not just the infrastructure companies powering them.
Inclusion in the S&P 500 can be harder The biggest risk is assuming that a company's quick index inclusion can also translate into quick inclusion in the S&P 500. However, S&P Dow Jones Indices, part of S&P Global, recently decided not to loosen its main eligibility rules for the S&P 500, S&P MidCap 400, and S&P SmallCap 600. So newly public companies will still need at least 12 months of trading history before they can be considered for inclusion in these indexes. They also need to pass S&P's profitability test, which usually requires positive GAAP net income in the latest quarter and over the past four quarters combined.
OpenAI still has a long road to profitability. Anthropic's heavy computing needs could also make S&P's profitability screen a harder hurdle.
However, S&P Dow Jones Indices changed eligibility rules for the S&P Total Market Index, S&P Completion Index, and Dow Jones U.S. Total Stock Market Index. Eligible IPOs can still get fast-track entry into some indexes if they meet the updated float and other requirements. So OpenAI and Anthropic could enter these market indexes soon after going public.
Regulation challenges are also important for investors. According to Reuters, OpenAI seems to be considering giving a 5% stake to the U.S. government. Anthropic also had to disable access to its top-tier models after a U.S. government order limiting foreign access. While these challenges may not prevent either company from entering certain indexes after listing, they may negatively affect IPO timing, valuation, revenue visibility, and post-listing volatility.
SpaceX shows that mega IPOs can quickly enter some index funds, especially through Nasdaq-linked and broad-market products. Investors should focus not only on whether these companies enter indexes, but also on which indexes they enter, how much weight they receive, and whether the businesses can justify their valuations after the first wave of passive buying.
Index-inclusion day is supposed to be a party. Passive funds line up to buy, forced demand meets thin supply, and the newly added stock pops. That is the script. SpaceX (NASDAQ:SPCX) officially joined the Nasdaq 100 today, and by lunchtime shares were down 5.65% to $151.35, while the broader Nasdaq 100 proxy QQQ slipped 1.74%. So SpaceX is underperforming the very index it just joined on the day it joined.
Steve Grasso, CEO of Grasso Global, went on CNBC this morning and said the quiet part out loud. Institutional buyers already front-ran this.
What Actually Happened on Inclusion Day Grasso’s read, delivered during the “Morning Call Sheet: AI trade stays strong despite semiconductor pullback” segment, is that flat-to-lower price action at the exact moment forced buyers show up tells you something. Front-running an index add is what it sounds like. Hedge funds and quant desks know weeks in advance which stock is about to get added, they buy it early, and they sell into the passive-fund demand on inclusion day. If the stock does not pop when the buying arrives, it is because someone was there first. Reddit noticed too. r/stocks users landed on the framing “SPCX finally joined the Nasdaq-100. The first reaction was to sell it”, and community sentiment collapsed from a bullish reading of 72 over the weekend to a very bearish 18 by Tuesday morning.
Why $27 Billion Still Has to Chase This Stock The mechanical piece Grasso keeps hammering is the part most retail investors miss. The Nasdaq 100 is float-weighted, meaning your weight in the index depends on how many shares actually trade freely, not on total market cap. SpaceX has a roughly $1.15 trillion market cap but only a sliver of that is public float. Jim Cramer walked through the same dynamic in June, noting that “when SpaceX comes public, it will be weighed like a $225 billion company” and that “as the lockups gradually expire and SpaceX’s float increases, so will its weight within the index”.
Grasso puts a number on the cumulative demand. Roughly $27 billion in notional passive buying will have to be absorbed in tiers over time as each lockup releases and index funds are forced to rebalance up.
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That demand arrives as a staircase, tier by tier, not in a single session.
The Front-Running Tell, and What Grasso Is Doing About It The staircase is why Grasso stays long. He added to his SpaceX allocation, plans to hold longer, expects extreme volatility, and sees a decent chance of a retest of $135 before the next leg higher. It also implicitly admits the easy money got pulled forward. The retail crowd sniffed this out too.
When a third of the float is short and the stock still cannot rally on forced index buying, the short thesis has more weight than the retail bulls wanted to believe. For context on why the underlying business justifies staying engaged through the chop, SpaceX is now a three-pillar company. Falcon and Starship on the launch side, Starlink delivering broadband via approximately 9,600 satellites to customers in 164 countries, territories, and other markets, and xAI, acquired in early 2026, making Grok a core asset.
What This Means for You The tiered demand is real. The forward pull on returns is also real. If Grasso is right about a $135 retest, chasing SPCX at $151 on inclusion day is buying the top of the front-run rather than the bottom of the staircase. Volatility is the price of admission. Grasso’s own positioning, long and adding on weakness, is the shape of the trade for anyone who believes the mechanical bid arrives in waves rather than in a single Tuesday morning bell.
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Brian Dobson and Greg Pendy from Clear Street examine SpaceX's (SPCX) edition to the Nasdaq-100 (NDX) Tuesday. The firm initiated SpaceX coverage with buy rating and a $217 price target.
The real headline may be the bank’s expectation that the company can grow revenue at a staggering 91% annual rate through 2030—a forecast that, according to JPMorgan, has surprisingly little to do with selling more rocket launches.
Instead, analyst Doug Anmuth argues launches are simply the foundation for a much bigger business.
The AI Story Hidden Behind the RocketsFor years, investors have viewed SpaceX primarily as a launch company powered by Falcon rockets and Starlink satellites.
JPMorgan believes that narrative is already becoming outdated.
Anmuth says “launch is SpaceX’s core competitive advantage that enables every other part of the business,” with rapid Starship reusability laying the groundwork for an AI infrastructure platform rather than simply a larger launch business.
By 2031, JPMorgan expects Starship launches to ramp from only a handful this year to roughly 5,000 annually, enabling SpaceX to deploy 75 gigawatts of orbital compute as it pursues an addressable market exceeding $28 trillion.
From Connectivity to AIThat shift fundamentally changes SpaceX’s financial profile.
JPMorgan projects revenue climbing from $19 billion in 2025 to $470 billion by 2030, while operating margins improve from negative 14% to roughly 50% over the same period. The driver isn’t simply more launch activity, but what the report describes as a business mix shifting from “Connectivity to AI, first terrestrial, and then orbital.”
Anmuth argues that transition justifies valuing SpaceX more like a next-generation AI infrastructure company than a traditional aerospace business.
Why Launch Still MattersIronically, the bullish AI thesis begins with rockets.
SpaceX has completed roughly 670 orbital launches with a 99%+ mission success rate and has launched more than 80% of all mass sent to orbit since 2023, according to JPMorgan. Those capabilities—and Starship’s rapid reusability—give the company a structural advantage that competitors cannot easily replicate.
That launch leadership, combined with what Anmuth calls SpaceX’s “extreme vertical integration,” enables the company to build not only rockets but also satellites, AI infrastructure and, eventually, orbital data centers faster and more cheaply than rivals.
For investors, that may be the biggest takeaway from JPMorgan’s initiation.
The firm’s $225 price target implies meaningful upside. But the more important bet is that SpaceX’s next decade won’t be defined by how many rockets it launches—it will be defined by what those rockets make possible.
Image via Shutterstock
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Space Exploration Technologies (SPCX 5.65%) was added to the Nasdaq-100 index before the market opened today, so investors might be surprised to see SpaceX shares fall. When a company's stock is added to an index, it can rise due to passive buying by mutual funds and exchange-traded funds (ETFs) that are required to hold the entire index.
So why were SpaceX shares down by 5.2% at 12:45 p.m. ET today?
Image source: The Motley Fool.
It's the math The Nasdaq-100 tracks the 100 largest non-financial companies listed on the Nasdaq Stock Market exchange. But even the funds and ETFs that buy SpaceX stock once it's on the exchange aren't really buying a large quantity of the company. Consider this:
SpaceX raised about $86 billion from its public share offering. But the company was valued at $1.8 trillion at the IPO price. That's less than 5% of the company available to the public. Elon Musk owns much of the balance, maintaining about 46% ownership. Other early investors, institutions, and employees own the rest.
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The company is using a phased lockup schedule to allow those early investors to sell their shares. The first batch of shares will be available for sale after SpaceX reports its second-quarter results, either late this month or in August. Notably, Musk won't be able to sell his shares until June 2027, but there could still be downward pressure on SpaceX shares in the near future from other sellers.
The relatively small amount being bought due to index inclusion, combined with fears that the coming initial lockup expiration will drive the stock lower, has shareholders pressuring the stock today.
Howard Smith has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
• SpaceX shares are sliding. What’s behind SPCX decline?
Here’s what analysts were saying.
The SpaceX AnalystsBofA Securities analyst Ronald Epstein initiated SpaceX stock with a Buy rating and a price target of $235.
RBC Capital analyst Ken Herbert initiated coverage with an Outperform rating and a price target of $225.
Needham analyst Ryan Koontz initiated coverage with a Buy rating and a price target of $200.
Cantor Fitzgerald analyst Colin Canfield initiated coverage with an Overweight rating and price target of $246, with SpaceX stock seeing a 64% upside from the current share price of $150.
• For more analyst ratings on SpaceX stock, check out Benzinga’s full coverage here.
Bank of America on SpaceXSpaceX is "paving the superhighway to the stars," Epstein said in an investor note about the space company.
"SpaceX has evolved from a launch company into the foundational enabler of the space economy and the leading provider of space-based applications as a result," Epstein said.
The analyst said SpaceX is able to convert launch and manufacturing into recurring businesses, such as Starlink.
Epstein noted part of SpaceX’s long-term opportunity hinges on Starlink’s commercialization and reusability.
"If achieved, we believe launch costs could decline by an order of magnitude while capacity expands dramatically. If delayed, the timing of many future growth vectors moves materially to the right."
RBC Capital on SpaceXSpaceX has a "proven track record of disruption and innovation," Herbert said in a new investor note on the space stock.
"We believe SpaceX will continue to benefit from its position at the center of two of the most profound investment themes of this generation: the evolution of the space-based economy and AI," Herbert said.
The analyst highlighted Starship as being a key for the company’s future along with Starlink momentum.
"We believe the opportunity of orbital data centers provides SPCX with the chance to deliver a structural and durable cost-of-compute advantage versus any terrestrial competitor."
Herbert said SpaceX is the best mega cap stock for exposure to space and AI.
"The convergence of space and AI represents a unique value-creation opportunity that we believe SPCX is well-positioned to capture."
Needham on SpaceXSpaceX is a leader with a multi-year lead for the space sector, Koontz said in the investor note.
The analyst highlighted the company’s Starlink segment, which had 10.3 million subscribers and $11.4 billion in revenue in 2025. Koontz saw more upside from the company’s Starship launch vehicle.
SpaceX’s vertical integration is an advantage that should help with future growth, the analyst added.
"The success in its Space segment is the foundation of the SpaceX competitive moat for its Starlink/Connectivity business as well as AI/Orbital Compute strategy," Koontz said.
The analyst expected SpaceX to target expanding compute capacity by 2x each year.
Cantor Fitzgerald on SpaceXValuing a company that owns the entire tech stack is hard, Canfield said in a new investor note.
"SpaceX is something the market has never seen: the world’s first planetary infrastructure company," Canfield said. "Where prior tech giants owned one layer of the stack — compute, connectivity or distribution — SpaceX owns them all."
Canfield said this is not diversification, but rather "vertical integration at civilizational scale."
"We think investor debate has been anchored to near-term valuation multiples, which misses the central point: a planetary infrastructure company does not compete within existing markets — it defines the cost structure of new ones."
SpaceX Stock Price ActionSpaceX stock is down 4.86% to $152.63 on Tuesday versus a trading range of $147.11 to $225.64 since going public. The stock remains up from the $135 IPO price with shares flat from where they started trading.
Image via Shutterstock
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Space Exploration Technologies (SPCX 5.65%), aka SpaceX, seized the spotlight well before its initial public offering (IPO) early last month. The rocket launch, satellite communications, and artificial intelligence (AI) company has captured the public imagination as the company awaits several key hurdles in the coming weeks and months.
The first of these hurdles happened on Tuesday, as SpaceX officially joined the Nasdaq-100. Perhaps as importantly, the mandatory quiet period ended for the 23 investment banks associated with the SpaceX IPO. This kicked off a surge of new analyst ratings and the associated commentary -- and to say the overall consensus was bullish might well be an understatement.
Let's review the prevailing attitude on Wall Street and what a $10,000 investment in SpaceX might be worth in one year.
Image source: Getty Images.
The bulls outnumber the bearsSpaceX closed out the day at about $160 per share on Monday, but Wall Street expects the stock price to go much higher. According to TheFly.com, 19 analysts issued ratings and price targets on Tuesday morning (as of this writing), and the overall conclusion was extremely bullish. Nearly all of the 19 ratings came in at the equivalent of a buy or strong buy, and had a median price target of $250. For those keeping score at home, that represents potential upside of 56% compared to Monday's closing price.
That said, the price targets run the gamut, with the lowest at $131 and the highest at $800. The majority of the ratings -- or 14 of the 19 -- fall within a range of between $200 and $250, representing an average price target of $225, or potential upside of about 40%.
A bearish takeMoffettNathanson analyst Julie Zhu was the sole outlier on Tuesday, initiating coverage with a neutral (hold) rating and a price target of $131, which suggests potential downside for investors of 18%.
The analyst takes exception to CEO Elon Musk's plans to launch data centers capable of delivering 100 gigawatts (GW) of compute annually by the end of 2029. That total is "an amount that exceeds global in‑service data‑center capacity today and for which sufficient material inputs will not exist in three‑and‑a‑half years," according to the analyst. Zhu goes on to say that there's "simply no credible financial model that can support what is, at the time of this writing, a roughly $2 trillion valuation."
If the analyst is right, a $10,000 investment in SpaceX could be worth as little as $8,733 over the coming year.
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A really bullish takeOn the other end of the spectrum is Raymond James analyst Brian Gesuale, who initiated coverage with a strong buy rating and a Street-high price target of $800. That suggests potential upside of 398% compared to Monday's closing price.
The analyst hailed the intersection of orbital access and AI as driving "the most significant infrastructure convergence since the advent of the Internet." He believes the completion of Starship -- the company's next-generation super heavy rocket -- will reduce the cost of space travel and delivering objects into orbit by 99%, while simultaneously increasing payload "by an order of magnitude.” The analyst estimates that SpaceX will grow its revenue 21-fold to $837 billion and its EBITDA by 39x to $696 billion by 2031.
If the analyst's bullish take is correct, a $10,000 investment in SpaceX could be worth nearly $40,000 this time next year.
What this means for investorsSo what will a $10,000 SpaceX investment be worth next year? The truth is that no one can say with any certainty. However, throwing out the outliers returns a consensus stock price of about $225, which I believe is likely closer to reality than the most bullish or bearish takes from Wall Street.
A look at the 30 biggest IPOs of the past 15 years suggests a wide range of possible outcomes by the end of the year, with gains of up to 217% or losses of up to 77%. This could turn a $10,000 investment into as much as $31,700, or as little as $2,300.
To be clear, SpaceX stock has already given investors a sneak peek at the volatility they can expect over the coming year, so the stock won't be for the faint of heart. Furthermore, at 46 times forward sales, SpaceX isn't cheap. For investors who are still compelled to own a stake in SpaceX, I would suggest it be a small part of a well-balanced portfolio.
Even though it's only been public since June 12, Space Exploration Technologies (SPCX 5.65%), or SpaceX, has already traded in a wide range in less than a month, from a high of $225.64 to a low of $147.11.
With its inclusion in the Nasdaq-100, however, history shows that, on average, companies can expect their stock prices to move in a certain direction. This is what history suggests about whether the next move in SpaceX's stock price is higher or lower.
Image source: Getty Images.
The short-term results of Nasdaq-100 inclusion When a stock is included in the Nasdaq-100, it creates buying activity, as investment vehicles like exchange-traded funds that track that index must own it. But history says that being added to the index is not an immediate, game-changing moment for the company.
According to Barron's, over the last two years, of the 21 companies added to the Nasdaq-100, only six had their stock prices climb in the first week they were added. The average loss for a stock a week after inclusion in the index has been 3.8%.
Looking out a bit further, the good news for shareholders is that the data looks more promising. Stocks averaged a gain of 3.6% one month after being in the Nasdaq-100 and climbed 6.3% after three months.
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The bigger picture for SpaceX SpaceX shareholders will appreciate any type of stock price gain. But as history has shown, inclusion in the Nasdaq-100 won't be a meaningful needle mover right out of the gate.
Instead, it's important to focus on the long-term potential and risks of building out artificial intelligence (AI) infrastructure in space. SpaceX is going after what it believes is a $26.5 trillion total addressable market (TAM) in AI. If it executes on capturing as much of that TAM as possible, that is what can lead to the gains current shareholders are hoping for.
Jack Delaney has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
SpaceX Corp (NASDAQ:SPCX) just picked up a bullish new voice on Wall Street as Bank of America initiated coverage with a Buy rating and a $235 price objective.
The bank’s analysts argue SpaceX has outgrown its roots as a rocket launcher to become the backbone of the entire space economy.
Analysts said SpaceX has evolved from a launch company into what they called the foundational enabler of the space economy, pointing to the company's reusable launch technology and proliferated space applications as key competitive advantages. BofA said these moats are laying the groundwork for Starship and future applications to drive another paradigm shift in space capabilities.
The bank highlighted SpaceX's ability to convert its launch and manufacturing capabilities into recurring, market-leading applications businesses, most notably Starlink. Analysts described this as a flywheel effect, where launch capacity enables space applications, those applications generate cash flow, and the resulting cash flows fund further infrastructure investment.
BofA said Falcon and Starship launch economics remain the primary drivers behind SpaceX's ability to build high-margin application layers in orbit, even though this dynamic is not directly reflected in the company's financials due to its accounting structure.
Central to BofA's thesis is whether Starship can reach the reliability, launch cadence and cost economics needed to unlock SpaceX's next phase of growth. The bank said much of the company's long-term opportunity, including Starlink v3 deployment and future compute infrastructure, hinges on Starship achieving full reusability.
If successful, BofA estimates launch costs could fall by an order of magnitude while capacity expands significantly. Delays in that timeline would push back many of SpaceX's future growth vectors.
Analysts also pointed to SpaceX's orbital compute ambitions as a source of differentiated upside, framing the initiative as representative of broader option value tied to the company's launch moat, vertical integration and manufacturing scale.
BofA said SpaceX's entry into AI infrastructure and applications markets gives it an opportunity to apply its space positioning to fast-growing, competitive sectors, with other emerging space applications offering additional long-term value contingent on Starship's success.
SpaceX is benefiting from a shift towards AI, with broker calls coming out as the company gets included to the Nasdaq 100. This is setting a price floor for a stock that could be headed for the stars, says Joel Shulman, Founder & CIO of ERShares, whose ETF XOVR holds approximately $246 million in SpaceX exposure.
SpaceX joins the Nasdaq 100 Index Tuesday and many analysts are saying buy the stock. But Nicholas Owens of Morningstar has a sell rating and price target of $62.
HomeIndustriesAerospace/DefenseAnalysts are cheering major upside potential for SpaceX, with one calling the company the ‘apex of civilizational ambition’July 7, 2026, 10:16 a.m. ET
Many Wall Street analysts just became free to publish investment recommendations on SpaceX, and they largely offered glowing praise of the company and its goals.
“SpaceX SPCX represents in our view the apex of civilizational ambition, oftentimes expressed in steel and fire, bending the arc of history to make humans multiplanetary,” Deutsche Bank’s Edison Yu wrote in a client note on Tuesday, rating the stock at buy with a price target of $255 per share.
Wedbush research analyst Dan Ives recently initiated coverage on Space Exploration Technologies (SPCX 4.91%), marking a notable moment for Elon Musk's newly public company. Following SpaceX's historic IPO, Ives published an upbeat assessment emphasizing the company's space industry heritage and its emerging role in artificial intelligence (AI) infrastructure.
Ives' analysis frames SpaceX as more than a rocket and satellite operator, highlighting its status as a vertically integrated technology business with recurring revenue streams and strategic depth that could deliver long-term gains.
Image source: Getty Images.
Why does Dan Ives like SpaceX stock? Ives assigned SpaceX an outperform rating and a 12-month price target of $190. This implies roughly 18% upside from where it closed Monday's trading session. His optimism is supported by a sum-of-the-parts valuation model anchored to fiscal 2028 estimates, projecting an enterprise value near $2.5 trillion.
Central to the thesis is Starlink's potential to mature into a durable profit engine through steady subscription revenue. Interestingly, Ives is not the only analyst on Wall Street who sees game-changing potential from Starlink. Timothy Horan of Oppenheimer also cites Starlink's potential to disrupt the telecommunications industry as a major driver of SpaceX's future growth.
Additionally, Ives sees SpaceX accelerating its participation in hyperscaler AI build-outs. In essence, rather than viewing SpaceX solely through an aerospace lens, Ives emphasizes the company's access to expanding markets that create a diversified growth profile.
Image source: The Motley Fool.
How is SpaceX becoming an AI company? Over the last month, SpaceX has moved aggressively to better showcase its ecosystem, blending its strengths in space exploration with its AI capabilities. The company inked agreements to lease some of its compute infrastructure capacity to Google Cloud, Anthropic, and Reflection AI. Taken together, these contracts will be worth up to $82 billion over the next few years. Under these arrangements, frontier AI developers gain instant access to high-performance Nvidia GPU clusters housed in SpaceX's data centers.
Additionally, SpaceX recently agreed to acquire Cursor for $60 billion in an all-stock transaction. Cursor is a coding business that is expected to bring new software capabilities to SpaceX's broader AI portfolio. These moves signal that SpaceX is deliberately aiming to monetize existing AI infrastructure and integrate new talent as the company moves beyond its legacy launch and connectivity businesses.
As Ives points out, these AI-focused deals and acquisitions are not simple side hustles for SpaceX. Rather, these moves have the potential to create measurable synergies that can accelerate progress in SpaceX's rocket launch and satellite businesses.
Advanced coding and development tools from Cursor could be used to streamline software for flight control systems, trajectory optimization, and real-time decision-making during launches. Moreover, the new compute partnerships generate consistent cash flow that will support continued investment in capital-intensive segments like reusable rocketry. On the satellite side, Starlink's constellations are positioned to gain from AI-driven network management and predictive analytics that enhance coverage and data throughput for customers.
These interconnections reinforce a virtuous cycle for SpaceX. AI-driven revenue funds space innovation, while space-derived capabilities across Starship and Starlink can help support ever-larger AI workloads. This deep integration lends support to Ives' bullish case by showing how new revenue opportunities and technological advantages directly bolster the company's established strengths.
Should you buy SpaceX stock right now? Since SpaceX's IPO last month, the stock has displayed notable volatility. In reality, the company still has considerable ground to cover before it could conceivably demonstrate the ability to generate consistent profitability and operational scale across its portfolio. In my view, much of the momentum around SpaceX stock is amplified by the enduring influence of Elon Musk and high-visibility endorsements from influential pundits and analysts like Ives.
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While SpaceX stock may be appealing to investors who find management's ambitions credible, simply investing in the company based on an analyst's initial report is not a strategy that's likely to produce multibagger gains anytime soon.
When weighing an investment in any company, a measured approach focused on the business's fundamental progress rather than endorsements or headlines is always the more prudent path. With this in mind, I think the better approach to SpaceX would be to assess its financial results over the next several quarters and listen to management's forecasts about where the company is headed throughout the AI infrastructure era. There will be many opportunities to invest in SpaceX stock at more reasonable valuations over the long run.
Space Exploration Technologies Corp. (NASDAQ:SPCX) formally joins the Nasdaq-100 today, less than one month after the largest U.S. market IPO in history.
The index addition will force ETFs and index funds to acquire shares of SPCX, producing billions of dollars of mandatory buying that could cause one of the stock’s most tumultuous trading sessions since its public debut.
The move bolsters SpaceX’s position as one of the largest tech companies in the market. However, traders are faced with a tough question: Is today’s opening rise worth chasing?
The answer lies not so much in the fundamentals as in how the institutional order flow plays out in the opening hour of trade.
Why Today’s Nasdaq-100 Inclusion MattersThe Nasdaq-100 is an index of the 100 largest non-financial companies listed on the Nasdaq exchange.
The analysts think the rebalancing might create about $4.3 billion in passive flows.
These funds cannot wait for a better price, as active investors do. Their mandate requires them to take the stock at any price, producing demand that often exceeds typical trading.
That request comes at a time when the readily tradable quantity of the stock is still relatively small.
SpaceX’s IPO garnered $75 billion by selling 555.56 million shares. Yet, CEO Elon Musk still controls more than 82% of the company’s voting power. Most existing owners still can’t sell for several more months due to insider lockup regulations.
Today’s session could see wide price swings due to the mismatch of forced demand and constrained supply.
SPCX Stock Analysis: Price Levels to WatchSPCX finished Friday at $162, up around 20% from its $135 IPO price.
With the stock expected to attract billions of dollars in passive fund inflows, traders will be closely watching how the stock reacts around several key resistance and support levels
On the upside, the $185 to $190 range represents the first major resistance area. The zone closely aligns with Wedbush’s $190 price target, which accompanied the firm’s recent Outperform initiation.
Wedbush based its bullish outlook partly on SpaceX’s growing artificial intelligence business. In its analysis, it included an estimated $27.8 billion in annual AI-related revenue generated through partnerships with Anthropic and Alphabet.
If mandatory index buying drives SPCX’s stock price higher after the opening bell, traders could see increased profit-taking near this widely watched valuation target.
On the downside, the $158 to $161 area remains the SPCX stock’s most important near-term support.
Heavy trading during SpaceX’s June 12 market debut established a strong volume anchor around the first-day closing price of $160.95, placing the zone just below Friday’s close of $162.
A successful defense of this range would suggest institutional demand continues to absorb selling pressure created by early volatility.
Below that, $150 could be a key level for the market. The level marks SpaceX’s opening price on its first day of public trading. During that period, roughly 58 million shares changed hands during the opening auction.
A sustained move below $150 would indicate that selling pressure has begun to outweigh the passive buying generated by the Nasdaq-100 rebalance. If sustained, such a move could potentially shift short-term momentum in favor of sellers.
Why Chasing the Opening Bell Can Be CostlyThe first 30 to 60 minutes of trading are viewed as the most volatile session, as passive index funds finish their required buying and institutional desks reposition around the Nasdaq-100 rebalance.
Analysts expect SPCX to attract about $4.3 billion in passive flows as ETFs and index-tracking funds, notably the Invesco QQQ Trust (NASDAQ:QQQ), rebalance their holdings.
These funds need to be bought regardless of the price. Therefore, liquidity can turn one-sided for a while, typically resulting in violent swings and bigger bid-ask spreads.
That might set up a nice chance for short-term traders and market makers to sell into the opening strength. Similar index inclusions in the past have led to outsized opening volatility before prices settle down later.
Traders might want to sit on the sidelines and see whether the SPCX stock can build support above the $161 zone. The goal could be to avoid chasing an early breakout and waiting for volume to normalize.
If that range holds after the initial wave of passive buying, then it would suggest that demand is more than just forced index rebalancing.
Rebalance Beyond the Nasdaq-100 InclusionToday, index mechanics will mostly drive price activity. However, longer-term investors will eventually turn back to SpaceX’s operating performance.
The corporation had revenue of about $31.2 billion in the prior year, with Starlink contributing about $18.7 billion, or over 60% of total revenues. That subscription business continues to be a recurring income generator even as SpaceX cranks up spending on Starship, rocket infrastructure, and next-gen satellite deployments.
Those investments still are not cheap. The corporation posted a net loss of almost $4.9 billion last year as capital expenditures continued to rise, implying execution on future growth plans will remain key.
Other things traders should watch closely, aside from today’s index inclusion, are future Starship test flights and FAA licensing decisions.
Apart from those, the launch cadence, more Starlink subscriber growth, and the pace of government and commercial contracts are also areas to watch. The medium- and long-term valuation of SPCX is more likely to be determined by the catalysts rather than the rebalance of the Nasdaq-100
SPCX Stock Today: The Final WordAdding SpaceX to the Nasdaq-100 is a structural milestone that might push one of SPCX’s biggest trading days since its IPO.
But today’s buying impetus is mostly index rebalancing, not a shift in the company’s fundamental value. When the passive fund flows dry up, the stock will move again on fundamentals, earnings expectations, and execution.
Patience may be the preferable tactic for traders. Perhaps, it is best to let the opening imbalance play out and then see if the SPCX stock can hold the $161 support zone. A risk-reward setup may be better than chasing the initial surge.
Benzinga Disclaimer: This article is from an unpaid external contributor. It does not represent Benzinga’s reporting and has not been edited for content or accuracy.
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As Space Exploration Technologies Corp. (NASDAQ:SPCX) shares traded in consolidation over the past two weeks, more than a dozen Wall Street analysts initiated coverage of SpaceX stock on July 7, 2027.
On Tuesday, Brian Gesuale, an analyst at Raymond James, initiated coverage of SpaceX stock with a ‘Strong Buy’ rating. He also set his 12-month price target for SpaceX stock at $800, signaling a nearly 400% bull rally.
Brian Dobson, an analyst at Clear Street, set a price target of $217 for SPCX stock. Jonathan Siegman, an analyst at Stifel Nicolaus, set his 12-month price target of $190 for SPCX stock.
Ken Gawrelski, an analyst at Wells Fargo, set a 12-month price target of $230 for SPCX stock. John Goyn, a Wall Street analyst at Citigroup Inc. (NYSE: C), set a price target of $200. Adam Jonas, an analyst at Morgan Stanley (NYSE: MS), set a 12-month price target of $300.
Eric Sheridan, an analyst at Goldman Sachs Group Inc. (NYSE: GS), set his 12-month SPCX stock price target at $205. John Hodulik, a Wall Street analyst at UBS, set a price target of $210 for SpaceX shares.
Louie DiPalma, an analyst at William Blair, initiated coverage of SPCX with a buy rating but did not set a specific price target for SpaceX stock. Douglas Harned, an analyst at Bernstein, set a 12-month price target of $239 for SpaceX stock.
Doug Anmuth, a Wall Street analyst at JPMorgan Chase & Co. (NYSE: JPM), set a 12-month price target of $225 for SPCX shares. Jonathan Atkin, an analyst at RBC Capital, set a price target of $225.
Paul Golding, an analyst at Macquarie, set a $250 price target. Meanwhile, Colin Canfield with Cantor Fitzgerald, Brett Linzey at Mizuho Securities, and Ryan Koontz from Needham set a 12-month price target for SpaceX stock at $246,$200, and $200, respectively
As such, 26 analysts surveyed by TipRanks have set an average 12-month price target of $216.48 for SpaceX stock.
SPCX analysts forecast. Source: TipRanks SpaceX stock price performance Since its June IPO (Initial Public Offering), SPCX stock price has not closed below its debut value. At press time, SPCX stock traded at about $160.42, up over 18% from its IPO price.
SpaceX stock price chart. Source: Finbold As such, Wall Street analysts expect SpaceX stock to rally nearly 35% over the next 12 months.
That’s because SpaceX officially joined the Nasdaq-100 just 15 trading days after its blockbuster IPO—the fastest major index inclusion following an IPO after Nasdaq introduced a new fast-track rule earlier this year. The move forced index funds tracking the benchmark to purchase billions of dollars worth of SpaceX shares, regardless of whether portfolio managers believed the stock was attractively valued.
How Investors Ended Up Owning SpaceXUnlike actively managed funds, index funds don’t decide whether a stock is expensive or cheap. Their job is simple: if the index changes, they change.
That’s exactly what happened with SpaceX.
JPMorgan estimates QQQ alone generated roughly $4.3 billion of buying demand, while total passive flows tied to Nasdaq-100 and related index products could have reached $22 billion to $27 billion.
Passive Doesn’t Always Mean Hands-OffFor many investors, the episode offers a reminder that passive investing doesn’t eliminate investment decisions—it delegates them.
In this case, the decision wasn’t made by a fund manager. It was made when Nasdaq adopted a new rule allowing companies ranking among the 40 largest by market value to join the Nasdaq-100 after just 15 trading days of public trading.
The S&P 500 took a different approach.
While Nasdaq accelerated SpaceX’s inclusion, S&P Dow Jones declined to adopt similar fast-track rules, leaving SpaceX out of the benchmark for now because it has yet to satisfy the index’s profitability, public float and seasoning requirements.
What It Means for InvestorsNone of this says SpaceX is a good or bad investment.
The company has powerful long-term growth drivers, including Starlink, launch services and ambitious AI infrastructure plans. At the same time, critics point to its premium valuation, limited public float and ongoing losses as reasons for caution.
For millions of retirement savers, however, that debate may already be beside the point.
Whether they researched SpaceX or not, many investors now own a small piece of it simply by owning the index. And that’s perhaps the biggest lesson from SpaceX’s Nasdaq debut: passive investing doesn’t just track the market—it tracks the rules that define it.
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