SpaceX received a sell rating from CFRA on Friday, just minutes after listing on the Nasdaq market. The financial research firm also has a 12-month price target for SpaceX of $115, well below the public offering price of $135 per share and the current trading level of about $174 as of 1:19 p.m. ET. CFRA said SpaceX’s “valuation expectations have increased.” The company’s market capitalization was $1.77 trillion at its public offering price, but it’s now even higher after the stock soared in afternoon trading. To live up to that assessment, SpaceX needs to prove the viability of its Starship rocket, expand its Starlink internet service, generate profits from its artificial intelligence infrastructure and ultimately generate consistent free cash flow, according to CFRA. SPCX 1D Mountain SpaceX Deals “Our biggest concern is that SpaceX’s long-term strategy remains heavily dependent on Starship,” CFRA analyst Keith Snyder wrote in a note to clients on Friday, saying the Starship rocket could become a “bottleneck” for SpaceX’s various initiatives. The commercial viability of this heavy-lift rocket will depend on its reusability, which could generate huge savings and widen the company’s reach over competitors. Other Wall Street analysts were similarly focused on Starship on Friday. “Successful repurposing of Starship unlocks the most important value,” Wolfe Research’s Myles Walton wrote to customers. As for SpaceX, “You don’t have to believe in the target, just believe in Starship,” Walton wrote. Unlike SpaceX’s other rockets, Starship is designed to be fully reusable, which could boost the product’s profit margins by an additional 10% from current levels, Wolf said. CFRA’s Snyder said if Starship fails to meet expectations, many other parts of SpaceX’s overall business could be negatively impacted, including Starlink satellites, orbital AI computing and satellite-to-mobile operations. “Delays or technical setbacks at Starship could spill over into nearly every major growth initiative, creating significant execution bottlenecks,” he wrote.
