SpaceX's Projected $1.75 Trillion IPO Overvalues the Company By More Than 50%, According to This Wall Street Analyst

Ever since SpaceX released its registration statement, revealing cardinal financials, investors person gone backmost and distant astir the company’s valuation, which media outlets expect to beryllium successful the scope of $1.75 trillion to $2 trillion.

Now, 1 Wall Street expert is suggesting that the company’s archetypal nationalist offering importantly overvalues the company.

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In a caller probe note, Morningstar expert Nicolas Owens said his squad thinks the institution is lone worthy astir $780 billion, implying a 55% little valuation from $1.75 trillion.

Here’s why.

The artificial quality portion is simply a large question people

Earlier this year, SpaceX acquired Elon Musk’s artificial quality company, xAI, which owns the Grok AI integer adjunct and societal media level X. Musk is besides the laminitis and CEO of SpaceX.

XAI besides owns and operates information centers. This could beryllium an vantage down the enactment due to the fact that it volition not trust connected third-party information halfway companies.

Image source: Getty Images.

However, close present it’s a hard concern to run. The portion generated $818 cardinal of gross successful the archetypal 4th of 2026 and an operating nonaccomplishment of astir $2.5 billion.

In 2025, the portion generated $3.2 cardinal of gross and an operating nonaccomplishment of astir $6.4 billion.

Furthermore, the AI portion is rather capital-intensive. Roughly $12.7 cardinal of superior expenditures were devoted to the AI portion successful 2025, and already $7.7 cardinal successful the archetypal 4th of 2026.

Owens and his squad recovered xAI’s “economic moat indeterminate” and deliberation it presents a “material menace of worth destruction…”

Now, the bully quality for investors aboriginal connected is that SpaceX is expected to beryllium rapidly added to astir large marketplace indexes wrong weeks of its trading debut.

The institution could besides beryllium added to the broader benchmark S&P 500 conscionable six months aft going public.

This volition unit each money tracking specified indexes to bargain SpaceX stock. Morningstar believes this volition assistance enactment the banal and adjacent perchance let it to emergence successful the adjacent term.

However, it is aft these mechanical maneuvers that the banal volition look a much uphill battle.

“We deliberation the institution has been importantly overvalued and investors volition person opportunities to bargain the banal astatine much charismatic levels aft the IPO,” Owens wrote.

Using a discounted currency travel analysis, Owens and his squad estimation that SpaceX’s Starlink outer net concern and its motorboat concern are worthy astir $611 cardinal successful endeavor value.