SpaceX Looks Like a Bargain by One Key Metric, Morgan Stanley Says

SpaceX shares closed last week at $159, but on a growth-adjusted basis the private rocket maker trades at just 0.3 times its expected earnings growth rate — well below the 0.5-times median across megacap peers, according to Morgan Stanley analyst Adam Jonas.

In a Sunday note titled "Cheap and Getting Cheaper," Jonas called the stock "unusually cheap" by that yardstick. The PEG-style ratio divides a company's valuation multiple by its expected earnings growth, capturing what investors pay per unit of profit expansion.

The headline multiple tells a different story. At $159, SpaceX trades at roughly 30 times its 2028 expected operating profit, nearly double the 16-times Big Tech median.

"Adjusted for growth, SpaceX is one of the cheaper ways to play the strong optionality of the space and intelligence economy," Jonas wrote.

What does Jonas actually think SpaceX is worth?

Morgan Stanley carries a $300 price target. At that level, SpaceX would trade at 0.6 times on a growth-adjusted basis — roughly in line with Amazon and still cheaper than Meta and Alphabet.

Jonas slices that $300 into four components:

• $8 per share for external launch operations
• $118 per share for Starlink connectivity
• $8 per share for consumer AI tools, including Grok
• $165 per share for enterprise AI services

At today's $159, Jonas estimates the market credits Starlink and the rocket-launch business at $127 per share combined, and assigns just $32 to SpaceX's enterprise and consumer AI franchises.

Why has institutional ownership lagged?

Morgan Stanley clients hold unusually small positions in SpaceX, Jonas wrote. He blames the company's tangled mix of businesses for the reluctance — and frames it as the setup for upside.

"SpaceX is a conglomeration of many tightly interlinked businesses in sectors where, to fully appreciate any of them, investors have to understand all of them — or at least understand them in concert," he said.

Pure-play comparisons to aerospace-and-defense names or to AI peers miss the point. The whole, Jonas argues, is greater than the sum of its parts.

What catalysts could move the stock into year-end?

Jonas flags two near-term events. Starship Flight 15, the 15th test of SpaceX's next-generation launch system, could fly as early as the end of this month. The mission may attempt a "ship catch," a mid-air retrieval of the upper stage that would mark progress toward a fully reusable rocket and sharply lower launch economics.

"A ship catch could be the biggest positive catalyst since the IPO," Jonas wrote.

Third-quarter results, due later this month, will offer the first real read on adoption and monetization of SpaceX's AI offerings. The company acquired and rolled out products including Cursor and Grok Bot during the quarter.

What is the bear case?

SpaceX is private, illiquid, and tough to hedge. Even so, Jonas sees an asymmetric setup.

"At these levels, we think the risks of upside surprises far outweigh those on the downside," Jonas said.

A failed ship catch would not, in his view, derail the thesis. Citi has previously sketched a $12 trillion long-term valuation scenario for SpaceX, contingent on Starship maturing into a mass-launch platform.

For investors with access to the private market, the next 30 days — Starship Flight 15 and Q3 numbers — will likely decide whether the stock re-rates toward Jonas's $300 target or stays pinned near $159.