SpaceX valued at $780B by Morningstar, well below $1.75T IPO target

Morningstar’s equity analysts have estimated SpaceX’s fair value at about $780 billion, a figure well below the roughly $1.75 trillion valuation the company is reportedly targeting in its planned initial public offering. The assessment was published ahead of SpaceX’s investor roadshow.

The research firm used a discounted cash flow framework and probability-weighted scenarios for the company’s diverse businesses. Morningstar’s breakdown attributes roughly $611 billion to core businesses — principally Starlink satellite broadband and launch operations — while assigning about $170 billion to various scenarios for the company’s AI-related ventures, including xAI and related infrastructure. The analysts cautioned that Grok, xAI’s chatbot, is not currently ranked among the leading AI labs and that unproven concepts such as orbital data centers pose execution risk.

Morningstar noted that limited free float at the debut and heavyweight underwriting by major investment banks could support near-term price strength, but warned of potential selling pressure as lock-up periods expire. That duality — short-term scarcity versus longer-term execution and valuation risks — frames the firm’s cautious stance ahead of the IPO.

The valuation gap highlights the challenge of pricing a conglomerate-like company that spans space transportation, global connectivity, AI and potential semiconductor investments. Competing in AI with established players and scaling Starlink profitably are material uncertainties that weigh on durable competitive advantage assessments. Morningstar’s view reflects these structural questions and results in a constrained moat assessment for the combined entity.

Market participants expect elevated volatility around the listing, with early momentum possible but ultimate returns hinging on demonstrable revenue and margin progress from Starlink and clearer monetization from the AI initiatives. For investors, the key watchpoints will be subscriber and unit economics trends at Starlink, tangible commercial traction from xAI, and the post-IPO share supply dynamics once lock-up restrictions lapse.