Morningstar Says SpaceX Is Worth $780 Billion, Far Below IPO Target
Synopsis
Morningstar analysts said SpaceX is worth around $780 billion, much lower than the company’s reported $1.75 trillion IPO target ahead of its planned Nasdaq debut. The research firm raised concerns about SpaceX’s artificial intelligence business, competition from OpenAI and Anthropic, and untested technology projects linked to future growth. Despite the warning, analysts said the stock could still rise in the short term after listing because of strong investor excitement and support from major Wall Street banks underwriting the IPO.
Morningstar valued SpaceX at $780 billion, far below the company’s reported $1.75 trillion IPO target ahead of its planned Nasdaq listing.
Key Highlights
- Morningstar estimated SpaceX’s valuation at $780 billion.
- SpaceX is reportedly aiming for a $1.75 trillion IPO valuation.
- Analysts raised concerns over the company’s AI business and growing competition.
- SpaceX is expected to launch its IPO roadshow on June 4.
Morningstar Raises Questions Over SpaceX IPO Valuation
Morningstar analysts placed a $780 billion valuation on SpaceX, significantly lower than the $1.75 trillion figure reportedly being targeted by the company in its upcoming public offering.
The report arrived just days before SpaceX is expected to begin its IPO roadshow on June 4. Reuters previously reported that the Elon Musk-led company plans to debut on the Nasdaq on June 12. Morningstar analyst Nicolas Owens said the stock could currently be “significantly overvalued” and suggested investors may find better entry points after the IPO launch.
Concerns Grow Around AI Business
Morningstar noted uncertainty surrounding SpaceX’s artificial intelligence operations, including xAI and social platform X. Analysts said the long-term economics of the business remain unclear while competition in the AI sector continues intensifying.
Owens added that xAI’s chatbot Grok is not yet viewed among the leading AI platforms, highlighting competition from firms such as OpenAI and Anthropic. The report also warned that several future AI-related projects rely on unproven technologies, including proposed orbital data centers in space.
Starlink Risks and IPO Expectations
Morningstar also pointed to technological risks facing Starlink, some of which may be beyond the company’s direct control. Despite these concerns, analysts said SpaceX shares could still rally shortly after listing because only a limited number of shares will initially be available, while major Wall Street banks are backing the IPO.
Banks involved in the offering include Goldman Sachs, Morgan Stanley, BofA Securities, Citigroup, and J.P. Morgan. SpaceX was valued at $1.53 trillion on a secondary marketplace for Forge Global, still above morning star’s estimates.
FAQs
- What valuation did Morningstar assign to SpaceX?
Morningstar valued SpaceX at $780 billion.
- Why is Morningstar cautious about SpaceX?
The firm cited concerns over AI competition and untested technology projects.
- Which companies compete with xAI?
OpenAI and Anthropic are considered major competitors
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