SpaceX Has 40% Upside from IPO per Wall Street Analyst. Here’s How

The IPO market has spent years searching for a company capable of reigniting investor enthusiasm. SpaceX (NASDAQ:SPCX) may be that company. After debuting in the largest IPO in history, the aerospace and AI giant immediately became one of the market’s most closely watched stocks. While many IPOs struggle to justify lofty valuations, at least one Wall Street analyst believes SpaceX is only getting started.

Oppenheimer initiated coverage with an Outperform rating and a $190 price target, implying roughly 40% upside from the company’s $135 IPO price. More importantly, the firm’s bullish case isn’t based on hype. It rests on multiple businesses that are growing simultaneously and could reinforce one another over the next decade.

More Than Just a Rocket Company

Many investors still think of SpaceX primarily as a launch provider. That’s increasingly outdated.

According to SpaceX’s IPO prospectus, the company generated $47.8 billion in revenue over the last 12 months. What makes the story unusual is that revenue comes from several fast-growing businesses rather than a single product.

Oppenheimer’s thesis centers on the idea that SpaceX deserves a premium valuation because these businesses complement each other. Starlink provides global connectivity. The launch business continues deploying satellites at a scale competitors struggle to match. Meanwhile, AI services create an entirely new growth engine.

Here’s what the numbers tell us. At its IPO valuation of approximately $1.78 trillion, SpaceX traded at roughly 37 times trailing revenue. That sounds expensive until investors compare it with leading AI companies that command premium valuations despite having far slower revenue growth.

The AI Opportunity May Be Larger Than Investors Realize

The most interesting part of the SpaceX story may be its AI ambitions. The company already operates one of the world’s largest distributed computing and networking platforms through Starlink. That infrastructure creates opportunities that few competitors can replicate.

One potential catalyst is larger AI compute contracts. Cloud giants such as Amazon (NASDAQ:AMZN | AMZN Price Prediction), Microsoft (NASDAQ:MSFT), Alphabet (NASDAQ:GOOG) and Meta Platforms (NASDAQ:META) are collectively expected to spend more than $700 billion on AI infrastructure in 2026. If SpaceX captures even a small portion of that spending through compute partnerships, revenue growth could accelerate beyond current forecasts.

Grok represents another opportunity. Today, most investors focus on OpenAI’s ChatGPT and Anthropic’s Claude. Yet Grok has an enormous distribution advantage through integration across the SpaceX ecosystem and affiliated platforms. Increased enterprise adoption, subscription growth, and AI agent deployments could create a recurring revenue stream that resembles software economics rather than aerospace economics.

Surprisingly, AI may eventually contribute more to profits than launches. Rocket launches are capital intensive. Software subscriptions generally are not.

Why the Bull Case Isn’t Guaranteed

Granted, investors should keep expectations realistic. SpaceX already carries a valuation larger than the entire market capitalizations of many Fortune 500 companies combined. Sustaining growth becomes harder as companies scale.

Competition is also intensifying. Amazon’s Project Kuiper continues building its satellite network. OpenAI, Anthropic, Google, and Meta are all competing aggressively in AI. Regulatory scrutiny could increase as SpaceX expands across communications, AI, and aerospace markets.

That said, the company possesses advantages few rivals can match. It controls launch capacity, satellite infrastructure, global connectivity, AI development, and increasingly valuable data networks under one corporate umbrella.

Key Takeaway

In short, Oppenheimer’s 40% upside target isn’t based on a single breakthrough product. It reflects the possibility that investors are still valuing SpaceX as pieces rather than as an integrated platform company.

The launch business alone is impressive. Starlink is already a global communications powerhouse. The wildcard is AI. If SpaceX signs larger compute contracts, expands Grok adoption, and successfully monetizes its growing infrastructure footprint, today’s valuation may prove less aggressive than it appears.

Ultimately, the biggest risk for investors may not be that SpaceX grows too slowly. It may be that Wall Street is still underestimating how many businesses SpaceX is becoming at once.