Oppenheimer Targets $2.5 Trillion for SpaceX as IPO Sparks Fierce Analyst Battle

Oppenheimer Targets $2.5 Trillion for SpaceX as IPO Sparks Fierce Analyst Battle​

The highly anticipated debut of Elon Musk’s SpaceX is drawing intense and divergent reactions from global investment banks. As the rocket and AI company prepares its market entry, brokerages are rapidly launching coverage, creating a dynamic battleground of valuations. Oppenheimer became the first major brokerage to begin research on the entity ahead of the planned $75 billion IPO, setting an extremely bullish tone for the eventual listing.

The near-instantaneous interest showcases both the immense potential and the inherent risks associated with valuing a technology giant operating at the cutting edge of spaceflight and artificial intelligence. The varied analyst opinions underline the complexity of assessing a company that is simultaneously building rockets and developing advanced AI systems.

Oppenheimer’s $2.5 Trillion Vision for SpaceX​

Oppenheimer issued an "outperform" rating, projecting a price target of $190, which implies an upside of nearly 41% based on the IPO price of $135. This aggressive outlook suggests that Oppenheimer expects Elon Musk-led SpaceX to achieve a market capitalization of approximately $2.5 trillion within the next 12 to 18 months.

Analyst Timothy Horan highlighted the company’s unique position, stating in a note published on Thursday that SpaceX stands as "the only vertically integrated AI company" possessing the necessary capital, data, LLMs, hardware, manufacturing, and engineering talent. Horan believes Starlink will serve as the primary cash generator, while the AI business, including xAI, will eventually become the largest revenue contributor.

Divergent Expert Opinions on Company Valuation​

While Oppenheimer set a massive target, not all analysts shared the same degree of optimism regarding the company's prospects. Morningstar analyzed the company’s valuation at $780 billion earlier this month, noting that this figure was less than half of what the company is reportedly targeting in its IPO. These analysts cited uncertainty surrounding the prospects of their AI business, which encompasses xAI and the social media platform X.

New Street Research also initiated coverage quickly, offering a price target of $165 over a 12-month period. This suggests high confidence but tempers Oppenheimer’s extreme bullishness while remaining significantly positive. Horan also noted that an eventual merger with Tesla is "plausible," though he maintains both entities will need to operate as a quasi-vertically integrated ecosystem to secure access to capital markets.

Market Dynamics and Post-Debut Demand Expectations​

The timing of analyst coverage itself presents a unique market dynamic. Unlike the underwriters—which include major firms like J.P. Morgan, Goldman Sachs, and Morgan Stanley—broakerages outside the IPO syndicate face no post-listing quiet period restrictions. This allows them to publish their views immediately before or shortly after the market debut.

Oppenheimer’s analyst anticipates that there will be an "initial demand/supply imbalance" for SPCX shares following the public offering. This expectation is driven by anticipated broad retail interest and potential accelerated index inclusion, setting up a highly charged environment for the stock upon listing.