SpaceX (SPCX) shares have rebounded to near $140, gaining nearly 5% over the past week, as investors found fresh reasons to bet on the latest public-market giant helmed by Tesla (TSLA) CEO Elon Musk.
Additionally, the latest 13F filings have added fuel to the fire.
According to 13f.info, AI giant Nvidia (NVDA) disclosed holdings of 122.76 million SpaceX shares valued at nearly $21 billion as of June 30.
Meanwhile, data from 13f.info shows Alphabet (GOOG) holds 551.2 million shares, valued at nearly $94.2 billion. Such formidable institutional backing has kept the stock in the spotlight since its dazzling debut in June.
Looking ahead, nearly 320 million restricted shares become eligible for transfer on August 20.
For context, the previous lock-up expiration on August 6 involved a larger tranche of 911.5 million shares, but as CNN reported, the feared sell-off never materialized. Instead, SpaceX shares bounced back above their $135 IPO price.
Wall Street remains bullish nonetheless, with an average price target of around $227, implying 62% upside, according to Seeking Alpha.
That's precisely why the report from five-star Phillip Securities analyst Glenn Thum is so intriguing—he values SpaceX stock at a dramatically different figure than the bulls.
Why Phillip Securities Sees SpaceX Falling to $75
Phillip Securities analyst Glenn Thum has just taken the most bearish stance on Wall Street regarding SpaceX stock.
Thum maintains a "Sell" rating with a $75 price target, implying 46% downside from the current price near $140. This also sits near the lower bound of the Wall Street consensus range.
Thum's forecast carries significant weight, as he is a TipRanks five-star analyst with an impressive 89% success rate.
That surpasses the track record of veteran analysts like Dan Ives, who boasts a 58% success rate.
Furthermore, 94 of the 106 investments he has tracked were profitable, with an average return of 20.8% per investment.
Interestingly, his concerns begin with artificial intelligence.
Musk has hinted that AI could become SpaceX's largest revenue source, not merely a side venture.
Musk told employees: "Our AI revenue will very likely—not very likely, but certainly—our AI revenue will very likely exceed all other SpaceX revenue in September, next month."
SpaceX's AI revenue grew 247% year-over-year in Q2, with nearly $1.6 billion coming from initial growth in cloud service agreements.
On the surface, such growth stocks typically command a premium from investors.
However, Thum believes these contracts lack the strength to justify such treatment.
Cloud agreements are billed monthly and, after the initial transition period, can be exited with just 90 days' notice.
More critically, one AI customer accounted for 19.5% of SpaceX's Q2 sales, up from less than 10% in the same period last year. This means if that key customer slows spending or terminates the relationship, SpaceX faces exceptionally high concentration risk.
Then there's the cost of pursuing growth.
Reuters reports that SpaceX's Q2 capital expenditures reached a hefty $18.4 billion—nearly 2.4 times its quarterly sales—and Thum expects this elevated spending level to persist for the next two quarters.
Moreover, compute capacity is expected to exceed 2 gigawatts by December, up from 1.4 gigawatts in June.
In short, his thesis is that SpaceX is spending as if AI demand is permanent before contracts have proven it to be so.
In his view, these compute deals must convert into multi-year commitments for the stock to justify a higher re-rating.
Despite SpaceX's recent rebound, the price target remains as high as $75.
AI Is Already Reshaping SpaceX's Sales Structure
SpaceX's relatively complex valuation becomes easier to grasp when its business segments are broken down.
In Q2, SpaceX generated total revenue of $7.81 billion. Of that, connectivity products led by Starlink contributed $4.29 billion, roughly 55% of total revenue. Additionally, the AI business contributed $2.56 billion, about 33%, while space products accounted for $962 million.
Clearly, AI is far more than an experimental side project for SpaceX on paper.
It is currently the company's second-largest sales engine, and the gap with connectivity could narrow quickly.
Thum argues that despite robust demand, investors are placing too much weight on sales supported by contracts that can be terminated with little notice.
However, scale matters.
SpaceX aims to surpass 2 gigawatts of compute capacity by December, up from 1.4 gigawatts in June, while pouring billions into the effort.
SpaceX Investors Are Paying Years in Advance
For SpaceX investors, the core debate centers on how much future growth potential is priced into the stock.
According to Seeking Alpha, at $140 per share, SpaceX trades at 373 times forward non-GAAP earnings, versus a peer average of just 13.4 times. On forward GAAP earnings, the multiple soars to approximately 1,891 times.
These figures look extreme because Wall Street expects earnings to grow from an exceptionally low base.
GuruFocus estimates GAAP EPS of just $0.008 in 2026, before jumping to $1.66 in 2027, $4.95 in 2028, $7.29 in 2029, and $11.19 by 2030.
At today's share price of $140, that means investors are paying roughly 84 times 2027 earnings, 28 times 2028 earnings, 19 times 2029 earnings, and only about 12.5 times projected 2030 EPS.
That's a revealing piece of information.
SpaceX's valuation looks exceptionally rich relative to near-term profits, but far more reasonable if Wall Street's long-term earnings growth projections materialize.
Revenue forecasts point to the same conclusion.
According to GuruFocus, sales are projected to grow from nearly $44.7 billion in 2026 to $103.8 billion in 2027, then surge to roughly $451.6 billion by 2030.
Essentially, this becomes a duration trade.
Investors are buying SpaceX shares today, betting that its AI, Starlink, and space businesses can quickly convert sales growth into earnings growth, thereby compressing its price-to-earnings multiple. On the other hand, if the AI business weakens, capital expenditures stay elevated, and margins remain thin, Thum's bearish thesis becomes far more compelling.
