Morgan Stanley finds bigger story in SpaceX’s $100 billion bet

OpenAI revoked Cursor's API access after SpaceX's $60B acquisition, citing Musk's past contract violations. SpaceX's Colossus clusters now power Cursor's $4B revenue, reducing reliance on rivals. Analysts set a $219 avg. price target for SpaceX, seeing 50% upside. The dispute stems from Musk's exit from OpenAI and ongoing legal challenges.

SpaceX's share price (SPCX) has halved since June, trading at $112, as investors consider high valuation and losses. Analysts' price targets range from $236 to $800. The company reported $18.674B revenue and $2.589B operating loss in 2025. Starship's success is crucial for its business model. Q2 results are due August 4.

SpaceX (SPCX) shares are down 37% from their June 2026 IPO high of $225.64, trading at around $141. Morgan Stanley reiterated an Overweight rating and $300 price target, citing long-term growth potential. OpenAI ended its partnership with SpaceX's AI coding tool Cursor, citing terms of service concerns. Analysts' price targets for SPCX range from $75 to $450.

Nvidia (NVDA) has acquired a $21 billion stake in SpaceX, making it the company's second-largest stock holding after Intel. According to an SEC filing, Nvidia now holds 122.7 million shares of SpaceX, which represents 30.9% of its investment portfolio. The move comes as Nvidia's portfolio grew by $45 billion in one quarter, driven by gains in Intel and new investments. Nvidia CEO Jensen Huang and SpaceX CEO Elon Musk have publicly praised each other's work, indicating a strong partnership.

SpaceX plans to invest $100 billion in Starbase Louisiana, a 125,000-acre launch complex, starting in 2027. This investment equals 23 times its annual space revenue. Starlink's 2025 revenue of $11.4 billion and $4.4 billion operating income funds this project. UBS estimates hyperscalers will spend $4.1 trillion on AI infrastructure from 2026 to 2028. SpaceX's investment strategy mirrors AI spending trends, focusing on future growth.

SpaceX (SPCX) began trading on Nasdaq after the largest IPO on record. The company dominates space, connectivity, and AI sectors, with a leading market position in rocket launches, satellite internet (Starlink), and AI models. SpaceX aims to expand its services globally and into space, targeting multi-trillion-dollar economic opportunities. The company's reusable rocket technology has significantly reduced launch costs, with 85% of missions using reused boosters.