Elon Musk's Space Exploration Technologies (NASDAQ: SPCX) went public on June 12. In the days that followed, the stock quickly rallied to a peak of $225.64, but it has since plummeted to as low as $104.83. As of Monday afternoon, it was trading around $146 -- still down by 35% from its peak, and below its first-day opening price.
SpaceX could create significant long-term value for investors through its space transportation, satellite internet connectivity, and artificial intelligence (AI) infrastructure businesses -- in fact, Musk thinks $1 trillion in annual revenue might be in the cards by 2030. But the stock's sky-high valuation might be a barrier to further upside in the near term. Here's where I predict its stock will be trading one year from now.
This Rare Signal Is Flashing Again. In 2009, a "Double Down" signal flashed for a little-known chipmaker called Nvidia. For the first time in years, that same "Total Conviction" signal is flashing for a company 1/100th the size of Nvidia.
Continue » No company has ever generated $1 trillion in annual revenue, but although Musk's forecast sounds ambitious, SpaceX might have a whopping $28.5 trillion total opportunity to capture across its three core businesses. First is space transportation, which currently has a $370 billion addressable market. SpaceX's Falcon 9 and Falcon Heavy reusable rockets launch around 2,500 tons worth of commercial payloads into orbit per year on behalf of other businesses, representing a 90% global market share.
But the company believes that number could grow to 10 million tons per year in the future as businesses race to send advanced satellites and even AI infrastructure into space. Then there is the connectivity business, which presents SpaceX with a $1.6 trillion opportunity. The company has launched over 10,200 of its own Starlink satellites into orbit, where they provide broadband internet access to 12 million paying customers here on Earth.
Later this year, it will start launching its new V3 satellites, which have 10 times the bandwidth of the current V2 generation. They will travel on the new Starship reusable rocket, which will have a record payload capacity, allowing it to carry far more satellites into orbit per trip. But SpaceX believes its biggest opportunity is in AI, which presents a $26.5 trillion addressable market across infrastructure, consumer subscriptions, and enterprise applications.
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