<\/p>\n
SpaceX(SPCX) stock is back trading near $140, up nearly 5% over the past week, as investors find new reasons to bet on Tesla (TSLA) CEO Elon Musk\u2019s newest public-market heavyweight.\u00a0<\/p>\n
Also, the latest 13F filings are only adding to the fuel.<\/p>\n
AI behemoth Nvidia(NVDA) disclosed 122.76 million SpaceX shares worth nearly $21 billion on June 30, according to 13f.info.<\/p>\n
At the same time, Alphabet (GOOG) reported 551.2 million shares valued at nearly $94.2 billion, according to 13f.info. That\u2019s some insane institutional firepower behind a stock that hasn\u2019t left the spotlight since its earth-shattering June debut.<\/p>\n
As we look ahead, nearly 320 million restricted shares will become eligible for transfer on August 20.\u00a0<\/p>\n
For context, the last lock-up release on August 6 was much bigger, at 911.5 million shares, yet the feared selling wave never came, as reported by CNN. Instead, SpaceX jumped back above its $135 IPO price.<\/p>\n
Nevertheless, Wall Street remains bullish, slapping an average price target of around $227, implying 62% upside according to Seeking Alpha.<\/p>\n
That\u2019s what makes five-star Phillip Securities analyst Glenn Thum\u2019s note particularly interesting, putting a very different number on SpaceX stock compared with the bulls.\u00a0<\/p>\n
Why Phillip Securities sees SpaceX falling to $75\u00a0<\/p>\n
Phillip Securities analyst Glenn Thum just took Wall Street\u2019s most bearish stance on SpaceX stock.\u00a0<\/p>\n
Thum kept a Sell rating and a $75 price target, implying 46% downside from the stock\u2019s current price near $140. That\u2019s also near the lower end of Wall Street\u2019s consensus range.<\/p>\n
Thum\u2019s call carries a ton of extra weight, as he\u2019s rated a five-star TipRanks analyst, with a tremendous 89% success rate across his ratings.\u00a0<\/p>\n
That\u2019s higher than veteran analysts such as Dan Ives, who has a 58% success rate.<\/p>\n
Moreover, of his 106 tracked calls, 94 were profitable, generating an impressive average return of 20.8% per rating.\u00a0<\/p>\n
More SpaceX:<\/p>\n
Morgan Stanley says SpaceX investors miss the bigger storyPeter Schiff says SpaceX is a warning for hyped stocksSpaceX stock defies latest Wall Street forecasts<\/p>\n
Interestingly, his concerns start with AI.<\/p>\n
Musk had suggested AI could potentially become SpaceX\u2019s biggest revenue engine, not merely a side business. I covered that shift in my Aug. 12 story, \u201cElon Musk just redefined what SpaceX could become.\u201d<\/p>\n
Musk told employees: \u201cProbably our AI revenue \u2014 not probably, definitely \u2014 our AI revenue will exceed all other SpaceX revenue probably in September, like next month.\u201d<\/p>\n
SpaceX\u2019s AI revenue skyrocketed 247% year over year in Q2, with nearly $1.6 billion stemming from the initial ramp of cloud-service agreements.\u00a0<\/p>\n
On the surface, that\u2019s the sort of growth investors typically reward with a premium multiple.<\/p>\n
However, Thum makes the case that those contracts aren\u2019t strong enough to justify one.<\/p>\n
The cloud agreements charge monthly fees and can be exited with just a 90-day notice following the initial ramp.\u00a0<\/p>\n
What\u2019s more important is that a single AI customer generated 19.5% of SpaceX\u2019s Q2 sales, up from less than 10% a year earlier. That has SpaceX carrying an unusually high concentration risk if one major customer slows down spending or walks away.<\/p>\n
On top of that, there\u2019s also the cost of chasing that growth.<\/p>\n
Reuters reported that SpaceX spent a whopping $18.4 billion on CapEx in Q2, nearly 2.4 times its quarterly sales, and Thum expects that elevated spending to remain near that level over the next two quarters.\u00a0<\/p>\n
Additionally, compute capacity is expected to exceed 2 gigawatts by December, up from 1.4 gigawatts in June.<\/p>\n
Put simply, his argument is that SpaceX is spending as if AI demand is permanent before its contracts prove it is.<\/p>\n
For the stock to re-rate higher, he argues that those compute deals must be converted into multi-year commitments.\u00a0<\/p>\n
SpaceX stock faces a $75 target despite its recent market rebound.<\/p>\n
Anna Moneymaker/Getty Images<\/p>\n
AI is already reshaping SpaceX\u2019s sales mix\u00a0<\/p>\n
SpaceX\u2019s relatively complex valuation becomes easier to understand when its business segments are pulled apart.<\/p>\n
For perspective in Q2, SpaceX generated $7.81 billion in revenue. Connectivity products, spearheaded by Starlink, contributed $4.29 billion, or roughly 55% of sales. On top of that, AI generated $2.56 billion, about 33%, while space products contributed another $962 million.<\/p>\n
So clearly, on paper, AI is far more than just an experimental side project for SpaceX.<\/p>\n
It is currently the company\u2019s second-largest sales engine, and that gap with connectivity is likely to close out pretty quickly.\u00a0<\/p>\n
Thum feels that even though demand is strong, he feels investors are assigning too much value to sales backed by contracts that can be exited with hardly much notice.\u00a0<\/p>\n
Nevertheless, the scale matters.\u00a0<\/p>\n
SpaceX is targeting over 2 gigawatts of compute capacity by December, up from 1.4 gigawatts in June, while dropping billions to build it.<\/p>\n
SpaceX investors are paying years ahead<\/p>\n
For SpaceX investors, the debate is pretty much about how much future growth is embedded into the stock.\u00a0<\/p>\n
At $140 per share, SpaceX trades at 373 times forward non-GAAP earnings, compared to just 13.4 times for the sector, according to Seeking Alpha. On a forward GAAP basis, the multiple balloons to roughly 1,891 times.<\/p>\n
Those numbers look pretty extreme, as Wall Street is expecting earnings to rise from a remarkably low base.\u00a0<\/p>\n
GuruFocus estimates put GAAP EPS at just $0.008 in 2026, before jumping to $1.66 in 2027, $4.95 in 2028, $7.29 in 2029, and $11.19 by 2030.<\/p>\n
If we take today\u2019s $140 share price, it means investors are paying roughly 84 times 2027 earnings, 28 times 2028 earnings, 19 times 2029 earnings, and only around 12.5 times projected 2030 EPS.<\/p>\n
That\u2019s a pretty telling piece of information.\u00a0<\/p>\n
SpaceX looks remarkably pricey when compared to near-term profits, but a lot less so if Wall Street\u2019s long-term earnings ramp materializes.\u00a0<\/p>\n
Revenue expectations point to the same story.\u00a0<\/p>\n
According to GuruFocus data, sales are expected to rise from nearly $44.7 billion in 2026 to $103.8 billion in 2027 before surging to about $451.6 billion by 2030.<\/p>\n
Essentially, it then becomes more of a duration trade.<\/p>\n
Investors are loading on SpaceX today, betting that AI, Starlink, and its space businesses could convert sales growth into bottom-line strength quickly enough to compress that multiple. On the flip side, if AI contracts weaken and CapEx is elevated with meager margins, Thum\u2019s bearish arguments become tougher to miss.<\/p>\n
Related: Peter Thiel invests $118 million in surging big tech stock<\/p>\n
#5star #analyst #sets #alarming #SpaceX #stock #price #target<\/p>\n","protected":false},"excerpt":{"rendered":"
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