Shares of SpaceX (NASDAQ: SPCX) fell almost 14% Wednesday as the company's second-quarter financial results, which revealed higher-than-expected capital spending, undermined investor sentiment.
One analyst is pleased with the rockets-to-AI firm's updated post-IPO goals.
The SpaceX Analyst
JPMorgan's Doug Anmuth reiterated an Overweight rating on SpaceX and raised the price target from $225 to $240, implying an upside of 122% from Wednesday's closing price of $108.27.
Analyst Takeaways
The commercial space titan's first quarterly earnings release as a public company were a "strong debut," Anmuth said in a new investor note.
"We went into SpaceX's earnings thinking there wouldn't be big changes to numbers given the June IPO was less than 2 months ago - we were wrong," he said.
The analyst highlighted SpaceX's new guidance for annual recurring revenue run rate of $100 billion by December and a goal of $1 trillion in revenue by 2030, a full year earlier than previously expected.
"The monetization story here is AI and compute," said Anmuth, highlighting SpaceX's new expectations of increasing compute to 5-10 GW in 2027 as "well above" JPMorgan's previous estimate of 4.2 GW.
"SPCX is leveraging engineering capabilities from rockets and satellites to scale data centers more rapidly than the industry," he added.
The analyst highlights SpaceX existing deals with Anthropic, Google and Reflection AI and a new mystery customer unnamed in the financial results.
That customer represents an additional $6.7 billion in cloud services revenue over six months beginning in October. JPMorgan predicts the customer could be Meta, OpenAI, Microsoft, Softbank or Nvidia.
"The step-up in compute capacity plus higher monetization suggests that SPCX could pull forward previously modeled AI revenue for 2028 of $100B+ to 2027," he said.
The analyst raises revenue estimates for 2026 and 2027 after the quarterly results.
An increased price target of $240 is based on a multiple of 34x 2028 estimated earnings per share of $7.02.
SpaceX Stock Price Action
SpaceX stock slid 13.6% to $108.27 on Wednesday, taking its losses from a post-IPO peak on June 16 to 52%.