Written by: Rita
SpaceX stock is at $163.42, with Morgan Stanley’s target price at $300, implying an upside of 83.6%. Investors see only rockets and satellites, overlooking the distributed inference cloud. Morgan Stanley believes this is SpaceX’s most underpriced and highest-potential growth area.
Morgan Stanley maintained an Overweight rating on SpaceX with a $300 price target in its report issued on October 13, 2026. The sum-of-the-parts valuation totals: Space at $8, Connectivity at $118, X and Grok at $8, and Enterprise AI at $165. Enterprise AI accounts for 55% of the target price, making it the largest value driver. Morgan Stanley believes investors still primarily associate SpaceX with launch services and Starlink, with enterprise AI and distributed inference cloud services virtually undervalued.
The rocket and satellite are merely surface manifestations.
Morgan Stanley divides SpaceX's business into two parts: What and Why. The What is observable: rockets, launch pads, ground stations, data centers, satellites, terminals, spacecraft, solar panels, turbine blades, semiconductors, telecommunications spectrum, and AI models. SpaceX spans consumer, industrial, and national security sectors.
Morgan Stanley noted that SpaceX is the most vertically integrated manufacturer and infrastructure player Wall Street has seen in the past 30 years, covering every aspect of AI infrastructure—from launches and chips to spectrum and AI models.
Why inference is needed. Morgan Stanley believes that SpaceX transforms energy into intelligence through physical agents (robots). The unified equation is i=erA2. A small amount of energy connecting a vast cluster of universal agents can generate immense intelligence. Investors need to envision a world with hundreds of billions of physical agents that must be interconnected.
Distributed inference cloud is the core.
Morgan Stanley believes that the most high-growth, least investor-recognized aspect of the SpaceX story is distributed inference cloud. Investors have already witnessed regulatory and social resistance to data centers. SpaceX’s initiatives are helping the superintelligence economy and physical intelligence economy enter their next phase of growth.
As physical agent density increases, the intelligent capabilities of collective motion clusters improve. Morgan Stanley uses ant colonies as an analogy: individual carpenter ants have limited individual function, but a colony of 15,000 mature ants can work together as an intelligent swarm. Billions of physical and digital AI clusters share information at the speed of light, far surpassing the energy of ant colonies.
Morgan Stanley expects investors to hear more about distributed inference clouds and physical AI clusters over the next year. This topic is nearing a breakout in investor discussions—first gradually, then suddenly.
Enterprise AI is implicitly undervalued
SpaceX stock is trading at $163.42, with an implied enterprise value-to-sales multiple in the low single digits for its AI business. Morgan Stanley’s sensitivity analysis shows that each additional gigawatt of named computing capacity, assuming $50 per watt, a 70% incremental margin, and a 10x EBITDA capitalization multiple, could increase the stock price by $27—approximately 15% to 20% of the current valuation.
Morgan Stanley estimates AI computing demand at 4.9 gigawatts for fiscal year 2027, with companies targeting nearly 10 gigawatts. If these targets are met, there is significant upside potential for enterprise AI value. Morgan Stanley believes the market is undervaluing enterprise AI, as the potential of distributed inference clouds and physical AI clusters has not been fully priced in.
In 2028, the enterprise value-to-EBITDA growth multiple for SpaceX is projected at 0.59x, below Tesla’s 4.60x, Microsoft’s 1.21x, and Palantir’s 1.61x. Morgan Stanley believes SpaceX’s valuation multiple is relatively low compared to its growth potential, with upside driven by a re-rating of enterprise AI.
Breakdown of the $300 target price
Morgan Stanley’s $300 target price is based on sum-of-the-parts valuation: Space at $8, Connectivity at $118, X and Grok at $8, and Enterprise AI at $165. Valuation date: June 30, 2027; forecast period through 2040. Weighted average cost of capital: 11.2%; cost of equity: 11.9%. Enterprise AI valuation is discounted by 50% to reflect execution risk.
Upside risks include faster Starship reusability progress, stronger Starlink capacity growth, increased direct-to-consumer and enterprise adoption, more new cloud orders, accelerated Cursor annual recurring revenue, and reduced power time and cost for AI infrastructure. Downside risks include slower Starship reusability cadence, slowed Starlink user growth, weak enterprise AI monetization, rising cost per watt of computation, extended power time, increased financing needs and dilution, and regulatory delays.
Morgan Stanley believes that SpaceX's fundamental momentum has strengthened in the areas of space, connectivity, and enterprise AI, with a more positive outlook following its Q2 earnings. The stock unlock did not suppress the stock price as expected. Morgan Stanley maintains an Overweight rating with a $300 price target.
Disclaimer
This article is a compilation and interpretation by Chaoxiang Research of a third-party brokerage research report (Morgan Stanley, October 13, 2026), combined with publicly available market information. The ratings, price targets, earnings forecasts, and related judgments cited herein reflect the views of the brokerage’s analysts and represent the position of their respective institution, not the views of Chaoxiang Research, nor do they constitute any investment advice.
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