The jump followed a Sunday note from Morgan Stanley analysts, who called SpaceX 'cheap' at current prices and highlighted 'future AI product releases, Starship progress, and additional neocloud contracts.' The bank recommends buying the stock and has a $300 price target, implying an upside of about 75% from Monday's close.
Late last week, SpaceX conducted multiple historic flights in a single day, including a crewed mission for NASA to the International Space Station and a separate launch of Google AI chips into orbit.
The Morgan Stanley analysts suggested investors buy SpaceX shares before the company's next planned test flight for its massive Starship rocket and ahead of its third-quarter earnings report expected in late October.
Starship is SpaceX's next-generation spacecraft, the largest rocket ever built, designed to be fully reusable with both its upper stage and booster able to land safely back on Earth. The system is expected to supercharge SpaceX's business, bringing Starlink satellites into orbit as well as cargo and crews from other companies and agencies. Should SpaceX attempt a Starship upper stage ship catch in its next test flight, that could be 'the biggest positive catalyst since the IPO,' the analysts wrote. In prior test flights, the Starship upper stage has made splashdowns in the ocean but has not been proven reusable.
SpaceX is also getting a boost from its artificial intelligence business, gained through the acquisition of Musk's xAI last year and expanded through the recent acquisition of Cursor. While the company's homegrown Grok model has not taken off compared to leading models from OpenAI and Anthropic, SpaceX is generating hefty revenue by renting out compute capacity to the likes of Google and Anthropic.
Musk has the benefit of close ties to the Trump administration. On Wednesday, the Pentagon appointed Musk as co-lead of Project Meridian, an initiative that involves identifying weapons, technologies and military capabilities the U.S. may need in future wars. SpaceX makes a large chunk of its revenue from the U.S. government and increasingly from defense contracts, earning over $12.7 billion to date from its work with the Defense Department, according to FedScout.