Morgan Stanley Analyst Flags $100 as Critical Level for SpaceX Stock Amid AI Valuation Debate

Morgan Stanley Issues Caution as SpaceX Shares Slide From IPO Highs

SpaceX (NASDAQ: SPCX) has experienced a notable pullback since its public market debut, with shares trading below $110 as of July 27, 2026 — a sharp decline from the $150 opening price when the stock began trading on June 12. As the company prepares to release its second-quarter 2026 earnings on August 4, a Morgan Stanley analyst is drawing attention to a key psychological threshold that could signal a deeper valuation problem.

The $100 Warning Level

Morgan Stanley analyst Adam Jonas addressed the growing gap between investor sentiment and SpaceX's underlying fundamentals in a note circulated through Bloomberg. His central concern: if the stock drops below $100 per share, it would suggest that markets are effectively assigning little to no value — or even a negative value — to SpaceX's expanding artificial intelligence operations.

"Most investors we speak with significantly discount Grok & Cursor," Jonas wrote. "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."

Despite those concerns, Jonas characterized the current price level as "an attractive entry point," citing the disconnect between where shares are trading and what he views as the company's longer-term potential.

SpaceX's AI Ambitions Take Center Stage

The analyst's commentary centers on two significant AI acquisitions that have redefined SpaceX's identity beyond rockets and satellites.

In February, SpaceX absorbed Grok — the AI chatbot previously operating under Elon Musk's xAI — into its portfolio. More recently, the company announced a definitive agreement to acquire Cursor, a widely used AI coding and software development platform, in an all-stock deal valued at $60 billion. That transaction is expected to close in the third quarter of 2026.

Beyond these acquisitions, SpaceX has been quietly building out AI infrastructure that is already generating revenue. Technology heavyweights including Anthropic, Alphabet, and Reflection AI are currently leasing compute capacity from SpaceX. Agreements with Anthropic and Alphabet alone could potentially contribute a combined $26 billion in annual revenue. Looking further ahead, SpaceX has outlined plans to deploy orbital data centers beginning in 2028 — a move that could position it as a distinctive player in space-based AI infrastructure.

Capital Expenditures Tell the Story

The financial scale of SpaceX's AI ambitions is reflected in its spending patterns. In 2025, the company's AI division consumed $12.7 billion in capital expenditures — dwarfing the $3.8 billion allocated to its core space segment and the $4.1 billion directed toward connectivity operations. The pace has accelerated: in just the first quarter of 2026, AI segment capex reached $7.7 billion.

That level of investment underscores why some analysts and investors remain cautious. The orbital data centers aren't expected to begin launching until 2028, meaning the heaviest spending is happening well ahead of the anticipated revenue payoff.

Broader Analyst Sentiment

Despite near-term uncertainty, Wall Street's broader consensus leans constructive on the stock. According to Bloomberg data, 80% of analysts covering SpaceX currently have buy-equivalent ratings on shares, with an average price target of $232. If accurate, that would represent substantial upside from current trading levels.

What Investors Are Watching

Several near-term catalysts will likely shape SpaceX's price trajectory in the coming weeks. The August 4 earnings report will offer the first detailed look at second-quarter performance and may provide updated guidance on AI segment spending and revenue. Separately, there is concern that potential insider selling ahead of or following the earnings release could add further downward pressure on the stock.

The broader question hanging over the stock is whether the market will begin pricing in the AI business more meaningfully — or whether the combination of heavy capital requirements, uncertain timelines, and execution risk will continue to weigh on sentiment. SpaceX's unique blend of space infrastructure and artificial intelligence ambitions makes it a company that analysts note requires careful attention to both technical and fundamental developments in the months ahead.