SpaceX's post-IPO selloff has dragged shares near a level that would imply investors are assigning essentially no value to the company's artificial intelligence business, according to Morgan Stanley analyst Adam Jonas — a disconnect he argues has created an attractive entry point even as the stock braces for a major share unlock next month.
A Rocky Debut
SpaceX has had a volatile trading history since its record $86 billion IPO in mid-June. Shares initially surged nearly 50% over the first three sessions, but have steadily retreated since, falling as low as $110.85 last week — about 18% below the IPO price — before closing Friday at $115.07.
The $100 Threshold
Jonas said many investors now expect the stock to fall further, toward $100, once the company's first lockup restrictions begin expiring next month. At that price, he argues, the market would effectively be assigning little to no value to SpaceX's AI operations — the business absorbed when SpaceX merged with Musk's xAI earlier this year. "Most investors we speak with significantly discount Grok & Cursor," Jonas wrote in a Friday note to clients. "Many ascribe zero or even negative value for AI given the high capex requirements relative to Space & Connectivity, largely uncertain economics, and the high degree of management time devoted to the business."
Why Jonas Sees It Differently
Jonas holds a $300 price target on SpaceX — among the highest on Wall Street — with more than half of that valuation attributed specifically to the company's AI segment. He argues the current selloff reflects "increasingly bearish investor sentiment" disconnected from "largely unchanged fundamentals," writing: "We believe the current disconnect... creates an attractive entry point in SpaceX shares." According to Morgan Stanley's estimates, the combined SpaceX-xAI entity could generate roughly $190 billion in AI-related revenue by 2030, with Jonas pointing to concrete AI compute deals worth $26 billion annually as underpinning his bullish case — even as xAI's projected $120 billion capital expenditure burn continues weighing on sentiment in the near term.
The Lockup Expiration Looming Over the Stock
The bigger overhang for SpaceX shares is a lockup expiration scheduled for August 6 — two business days after the company's first earnings report as a public company, due August 4 — when pre-IPO investors will be free to sell nearly one billion shares, an amount significantly larger than what was sold during the IPO itself. Some estimates place the value of shares eligible to hit the market at that point around $116 billion.
Wall Street Remains Broadly Bullish Despite the Slide
Jonas is far from alone in maintaining a positive outlook on SpaceX. Twenty-seven of the 32 analysts tracked by Reuters recommended buying the stock as of last week, and the average Wall Street price target implies more than 100% upside from current levels. Jonas — best known historically as a longtime Tesla bull whose bold calls on that stock often moved shares independently — stepped away from auto coverage last year to focus on AI and humanoid robotics, and has maintained his buy-equivalent rating on SpaceX throughout the recent pullback, describing the company as "uniquely positioned across launch, connectivity, and AI."
An Important Caveat
It's worth noting Jonas's $190 billion 2030 AI revenue figure is a projection rather than booked revenue, and Morgan Stanley's reporting doesn't fully detail how the firm separates the "AI" slice of SpaceX's valuation from its launch and Starlink cash flows, or how much of the newly unlocked share float insiders actually intend to sell once restrictions lift.
What's Next
With SpaceX's first quarterly earnings report as a public company due August 4 and the larger lockup expiration following just two days later on August 6, the coming weeks represent a critical test of whether Jonas's bullish AI valuation thesis holds up against what could be significant additional selling pressure from newly unlocked shares.