SpaceX Class A shares fell almost 7%, closing at $149.47 after their first trading session as a constituent of the Nasdaq 100, even as several major Wall Street banks initiated coverage with overwhelmingly positive ratings and price targets as high as $300.
The stock declined from Monday’s close of $160.42, extending volatility less than a month after the company’s blockbuster market debut on 12 June.
According to estimates by JPMorgan, SpaceX’s inclusion in the technology-heavy index could attract approximately $4.3 billion in demand from passive investment funds tracking the Nasdaq 100.
The company’s rapid entry into the index follows changes to Nasdaq’s eligibility rules for newly listed firms, making SpaceX one of the fastest companies ever added to the benchmark after its initial public offering.
Among the investment banks launching coverage, Morgan Stanley adopted the most bullish stance, assigning an Overweight rating and a price target of $300. Analysts led by Adam Jonas described SpaceX as occupying a unique position in global space infrastructure and argued that investors are underestimating the company’s artificial intelligence and satellite businesses.
Morgan Stanley also highlighted what it believes are SpaceX’s competitive advantages in terrestrial data-centre operations, estimating its costs are around half the industry average. However, the bank projected the company would require about $84 billion annually in external funding between 2027 and 2034 before generating positive free cash flow.
RBC Capital Markets initiated coverage with an Outperform rating and a $225 price target, valuing the company at roughly 15 times its projected 2029 EBITDA. The firm identified computing infrastructure as SpaceX’s long-term competitive advantage, arguing that demand for computing capacity would outlast individual AI models and applications.
RBC also pointed to the pace of Starship flight testing, the proposed acquisition of Cursor and the deployment of Starlink’s next-generation V3 satellites as key catalysts for the company’s share price.
Stifel took a more conservative approach, assigning a Buy rating with a $190 target price. The brokerage based its investment case on SpaceX’s leadership in launch economics, crediting the reusable Falcon 9 rocket with reducing launch costs to about $3,000 per kilogram.
However, Stifel applied a lower valuation multiple to the company’s AI business, citing execution risks surrounding orbital data centres, which it believes remain commercially unproven.
UBS also began coverage with a Buy rating, setting a $210 price target. The bank estimated the combined opportunity across launch services, satellite connectivity and artificial intelligence could approach $30 trillion if Starship achieves its expected performance.
The Swiss lender forecasts revenue and EBITDA growth of approximately 70% and 90% annually through 2031, while projecting launch costs could fall to around $200 per kilogram from roughly $1,000 currently.
UBS said the shares effectively offer investors exposure to Elon Musk’s long-term ambition of making humanity multiplanetary, although it does not include that scenario in its base-case valuation.
SpaceX raised about $86 billion in its record-breaking initial public offering after pricing shares at $135 each on 12 June. Despite Tuesday’s decline, the stock remains above its IPO price, although it is still well below the approximately $225 peak reached during its first weeks of trading.
