Oppenheimer was the first of the major brokerage firms to begin analyst coverage of SpaceX ahead of the company’s Friday initial public offering, valued at roughly $75 billion. The firm assigned an "outperform" rating and set a $190 target share price.
Oppenheimer’s $190 target implies nearly 41% upside versus the $135 IPO price. The brokerage expects SpaceX’s market capitalization could reach $2.5 trillion within 12–18 months, higher than the enterprise value targeted for the IPO at $1.75 trillion.
Timothy Horan, an analyst at Oppenheimer, argued that SpaceX is unique as a vertically integrated artificial intelligence company because it reportedly combines capital, data, large language models, hardware, manufacturing capacity and engineering expertise. Horan sees Starlink satellite internet as the initial primary revenue source, with the AI business that includes xAI potentially becoming more significant over time. He also said a merger with Tesla is conceivable, but that the two companies are likely to remain a quasi-vertically integrated ecosystem to preserve favorable capital market access.
Other analysts are more cautious
Not all market participants share Oppenheimer’s upbeat view. New Street Research also began covering the shares and set a 12-month target of $165. By contrast, Morningstar valued SpaceX at about $780 billion earlier in the month, which is less than half of the IPO-targeted value. Morningstar analysts flagged significant uncertainty around the prospects for the AI division that includes xAI and the X social media platform.
Market effects and research restrictions
Oppenheimer expects that strong retail interest and the likely rapid inclusion in indices after the debut could create a temporary supply–demand imbalance in the stock market; the article notes retail demand of more than $70 billion. Investment banks within the underwriting syndicate, including J.P. Morgan, Goldman Sachs and Morgan Stanley, are subject to a mandatory quiet period after the offering and therefore cannot publish research immediately. Brokerages outside the syndicate are not bound by the same restriction.
The reporting is based on Reuters. This article does not constitute investment advice.
