What is SpaceX’s AI business worth? Morgan Stanley bets on Starship recovery and a valuation rerating
Morgan Stanley believes the share price of around 145 dollars already reflects primarily the space and connectivity businesses, leaving a relatively low valuation for AI. The main incremental value in its 300-dollar price target comes from enterprise AI, while Starship reuse, access to power and financing costs determine how far that thesis can go.
Original source：Morgan StanleyFirst published on Unhidea：Original source date：
Key takeaway
Morgan Stanley is optimistic about SpaceX’s expansion from space and connectivity into full-stack AI, but its target valuation depends heavily on enterprise AI commercialization and infrastructure execution.
How much value does a share price of around 145 dollars leave for AI?
Morgan Stanley believes SpaceX is still priced like an ordinary emerging cloud-computing provider, with the potential of a vertically integrated, full-stack AI business not yet fully reflected. Its valuation breakdown assigns 123 dollars of the roughly 145-dollar share price to space and connectivity, leaving only about 22 dollars for AI.
In the bank’s model, this AI value corresponds to approximately 1.3 times enterprise value to sales for 2028. The assessment that it is “cheap” comes from valuing space and connectivity first and then examining the residual value, so the 123-dollar valuation used as the basis also determines the conclusion.
Why might Starship’s 15th test flight change the scope of the business?
The report expects the 15th test flight to take place in November 2026, and management has confirmed that it will attempt to recover both the booster and the spacecraft. Morgan Stanley sees it as a key test of Starship’s reusability; success would reduce the technical risk associated with broader business opportunities.
The bank further believes that a successful spacecraft recovery could reduce the cost of accessing and using orbital space by another order of magnitude. A lower cost threshold is the key link it draws between a single test flight and a larger commercial market.
As of the report, SpaceX had not yet recovered a Starship spacecraft; Musk’s stated probability of success of “more than half” still referred to an attempt yet to take place. The bank also lists slower-than-expected progress on reuse as a downside factor.
Why connect SpaceX with “physical intelligence”?
Morgan Stanley suggests that cooling data-center activity could broaden investment themes to the “physical intelligence economy,” extending attention from computing facilities to physical sectors such as manufacturing, robotics and space. This is the bank’s thematic assessment; SpaceX was not yet manufacturing chips or robots at the time of the report.
The bank believes closer cooperation between SpaceX and Tesla could help assemble the large amounts of capital needed to launch such businesses. The connection here is the ability to organize capital; the report does not describe a completed cooperation deal.
Which part of the 300-dollar price target depends most on execution?
Morgan Stanley assigns SpaceX an “overweight” rating and a price target of 300 dollars. In its sum-of-the-parts valuation, space contributes 8 dollars, connectivity 115 dollars, X and Grok 11 dollars, and enterprise AI 166 dollars: more than half the target price comes from enterprise AI.
The bank has applied an 50% execution-risk discount to its enterprise AI valuation, and the AI price-to-sales multiple implied by the target price has fallen from the teens to less than 10 times. Even with the lower multiple, the valuation rerating remains centered on the AI business.
The constraints are specific: weaker enterprise AI monetization, higher capital expenditure or power costs per unit of computing capacity, longer timelines for connecting to the power grid, and increased financing needs and equity dilution would all depress this portion of the valuation. Starship reuse and execution of AI infrastructure need to advance separately.
