Dan Ives of Yorkville Ives & Co. estimates an 80% to 90% probability that Tesla and Space Exploration Technologies Corp., known as SpaceX, will merge by the end of 2027. Ives says Tesla could command more than $500 per share in a combination. The probability represents Ives' forecast rather than a commitment from either company.
Ives argued in an October 26 research note that a merger would unite Tesla's autonomy and Optimus robotics operations with SpaceX's computing infrastructure, chip-design capabilities and capital. Ives' $500-per-share valuation allocates approximately $165 per share to Tesla's vehicle business. Ives assigns $335 per share to autonomy and Optimus. Ives views those valuations as reflecting businesses whose commercial operations have not yet reached full scale.
Ives believes Tesla shareholders would oppose terms that undervalue Tesla's opportunities in artificial intelligence, autonomous driving and robotics. Ives argues that a transaction below $500 per share would give SpaceX some of Tesla's potential gains at a discounted valuation. Ives' note says Tesla already owns a $2 billion investment in SpaceX. Ives also identifies potential collaboration in software, chip design, robotics, connectivity and Terafab, a planned AI-chip manufacturing project.
Elon Musk confirmed during the companies' third-quarter earnings call that Tesla and SpaceX had established special committees comprising independent directors to examine a possible combination. Musk withdrew from the discussions because Musk holds roles at both companies. However, Musk warned that a merger should not be considered inevitable. The companies had not agreed on terms. Musk said Tesla would require approval from holders representing 50% of all outstanding shares, rather than just a majority of votes cast. Tesla's latest SEC filing says a transaction is not assured.
The shareholder-approval threshold presents a substantial obstacle even if the boards identify strategic advantages. Tesla shareholders must assess whether proposed terms adequately value Tesla's vehicle operations and longer-term AI ambitions. Key developments include whether the committees reach agreement, how the companies value Tesla's autonomy and robotics operations, and whether shareholders approve a proposed exchange ratio. The $500 figure reflects the premium Ives believes Tesla shareholders would demand, not a guaranteed outcome. Whether the strategic advantages can produce terms acceptable to both companies and Tesla shareholders remains an open question.
Benzinga Pro data showed Tesla shares trading at $394.86, up 6.08%, at publication on Monday.
Analyst Predicts Tesla-SpaceX Merger by 2027 with $500 Share Price
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Summary
Analyst Dan Ives of Yorkville Ives & Co. predicts an 80% to 90% chance Tesla and SpaceX could merge by 2027, with Tesla shares hitting $500. The move could boost altcoins to watch amid growing market speculation. Ives cited synergies in autonomy, robotics, and chip design. Elon Musk confirmed special committees are exploring the deal, but no terms are set. A fear and greed index reading above 70 may signal investor optimism around the potential merger. Shareholder approval remains a key hurdle.
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