SpaceX shares are experiencing a significant rebound, fueled by enthusiasm for its artificial intelligence (AI) driven corporate strategy and the proven success of CEO Elon Musk's ventures, according to a new report from Argus Research. Despite concerns over the company's substantial capital expenditures, analysts are optimistic about the rapid returns expected from its AI infrastructure investments.
The aerospace giant, trading under the ticker SPCX, has seen its stock price jump 10% in early trading on Friday. This surge follows four consecutive weeks of declines, with the stock rallying approximately 17% over the past five trading days. Argus Research has upgraded its investment rating on SpaceX from 'Hold' to 'Buy,' maintaining a 12-month price target of $160, which suggests a potential upside of 39% from Thursday's closing price.
Analyst Steve Silver, in a note to clients, stated, "Despite an outlook for higher-than-expected capital expenditures — mostly for its AI infrastructure — we are encouraged by the rapid payback on these investments, given the robust growth in computing capacity."
SpaceX's initial public offering (IPO) on June 15 was met with considerable fanfare, with shares climbing 20% on the first day of trading. However, the stock experienced a sharp decline of 37% in July and a further 14% drop on Wednesday, following the release of its first quarterly earnings report as a public entity. In its second-quarter report released late Tuesday, SpaceX announced earnings and revenue that surpassed Wall Street expectations. Concurrently, the company disclosed that its capital expenditures had increased six-fold to over $18 billion during the same period, primarily driven by its intensified focus on AI development.
Even with the recent recovery, SpaceX shares are trading roughly 50% below their record high of $225.64, which was set in mid-June shortly after the IPO. The analyst also pointed to the looming expiration of lock-up periods for existing shareholders, which could introduce additional selling pressure. Over 300 million shares are slated to become eligible for trading later this month, with several hundred million more potentially available in September and October.
However, Argus Research advises investors to view any short-term price dips as advantageous buying opportunities, citing SpaceX's strong underlying fundamentals. "We expect the shares to remain volatile given the initial lockup expiration for insider shares, and expect several additional tranches over the next year," Silver wrote. "Nevertheless, SPCX's strong operational performance in [the second quarter of 2026] and robust growth outlook over the coming years mitigate these factors."
The report further highlights that SpaceX's valuation multiples have compressed significantly, presenting a more attractive entry point for potential investors. Argus projects that SpaceX's revenue will more than double in both 2026 and 2027. The firm also draws a parallel to Elon Musk's successful track record with Tesla (TSLA), suggesting similar growth potential for SpaceX. "The shares [of SpaceX] merit a BUY rating, in part, based on the track record of Elon Musk's other IPO, Tesla (TSLA). For reference, a $10,000 investment made in TSLA in 2010 is worth $2.5 million today, even after a double-digit decline year-to-date," the analyst added.
This optimistic outlook aligns with the broader Wall Street sentiment. Data from LSEG indicates that out of 36 analysts covering SpaceX, 28 have issued a 'Buy' or 'Strong Buy' rating.
