Is SpaceX Stock Cheap? 1 Wall Street Analyst Thinks So.

SpaceX reported Q2 2026 sales growth of 92%, with rocket launches up 55%, Starlink up 32% and xAI up 213%, but posted a $541 million net loss; only Starlink was profitable. The stock trades at 68 times trailing sales and 30 times expected 2028 profit. Morgan Stanley analyst Adam Jonas calls it cheap on a growth-adjusted basis and set a $300 12-month target versus a reported $162 share price, while the article cautions that the valuation remains expensive and risky.

Analysis

The key valuation risk is not whether revenue can grow quickly, but whether growth converts into durable consolidated earnings. A growth-adjusted multiple can look attractive when its denominator is a forecast several years out; it is especially fragile here because the current earnings base is negative and the businesses have materially different economics. The AI segment’s rapid expansion may increase the valuation story while also consuming capital before it produces measurable profit. Starlink’s profitability is therefore the quality-of-earnings anchor, not proof that the consolidated model has reached operating leverage.

Near term, analyst targets and the AI/space narrative can sustain momentum, making an outright short vulnerable to sharp squeezes. Over 1–3 months, watch segment-level operating income, cash flow, and disclosure on AI revenue versus investment. Over 6–18 months, the thesis improves only if growth broadens into cash generation without repeated increases in capital requirements. A reversal in execution, financing needs, or the broader appetite for high-multiple growth would expose the gap between current sales valuation and forecast profits.

Contrarian point: comparing a forecast growth-adjusted multiple with large-cap peers is not a margin of safety; it may obscure forecast risk and differences in business mix. PLTR and SNDK are not clean valuation hedges. The evidence supports caution and conditional risk-taking, not a confident valuation-driven short.

Key Decisions for Investors

• Avoid chasing SPCX on the analyst’s growth-adjusted valuation argument alone. Reassess after the next results, prioritizing segment operating profit, free cash flow, and capital spending over revenue growth.
• For an investor seeking downside exposure, consider a defined-risk SPCX put spread only if options are liquid and premiums are reasonable; otherwise remain underweight rather than shorting outright. The thesis is falsified by sustained improvement in consolidated cash generation alongside continued growth.
• Treat Starlink profitability as a necessary but insufficient signal. Track whether the other businesses’ losses narrow and whether AI-related growth is accompanied by disclosed customer demand and economics, rather than relying on projected 2028 profit.
• Do not use PLTR or SNDK as automatic pair-trade offsets: their business models and valuation drivers differ. Revisit a relative-value trade only with comparable forward earnings, margin, and growth data.