SpaceX Will Surpass Nvidia and Become Wall Street's Most-Valuable Public Company by the End of Next Year, According to One Wall Street Analyst
Key Points
SpaceX officially knocked Saudi Aramco off the pedestal on June 12, becoming Wall Street's largest-ever initial public offering (IPO).
A new Street-high price target implies a nearly $5.3 trillion valuation by the end of 2027.
However, history shows a 50% (or greater) loss is more likely for SpaceX.
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Less than two weeks ago, Elon Musk's artificial intelligence (AI) and space economy goliath, Space Exploration Technologies (SpaceX)(NASDAQ: SPCX), cemented its name in Wall Street's record books by raising $75 billion with its initial public offering (IPO). This nearly tripled the IPO capital raise by the previous recordholder, Saudi Aramco.
But according to one highly optimistic Wall Street analyst, SpaceX isn't done rewriting history. Based on a new Street-high price target assigned to SpaceX late last week, it could leapfrog the face of the AI revolution, Nvidia, by the end of 2027.
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Image source: Getty Images.
Can SpaceX launch to a $5.28 trillion valuation?
When SpaceX priced its shares for its June 12 debut at $135, it was commanding a $1.77 trillion valuation. However, Arete analyst Andrew Beale foresees SpaceX launching to $401 per share by the close of 2027. This represents 117% upside from where shares closed on June 18, and would enable SpaceX to surpass Nvidia's market cap.
Arete's Street-high price target, translating to a $5.28 trillion market cap, reflects the scalability of its space-based broadband platform, Starlink.
⚡️SpaceX $SPCX initiated with a Buy at Arete
-- TipRanks (@TipRanks) June 18, 2026
Arete analyst Andrew Beale initiated coverage of SpaceX with a Buy rating and Street-high $401 price target.
The company's Starlink V3 satellites open the "sizable" suburban broadband opportunity, the analyst tells investors in a... pic.twitter.com/LN1IWdZIq1
Among SpaceX's various operating segments, Starlink is currently the crown jewel. While AI start-up xAI boasts the largest addressable market, Starlink is the operating division that's currently profitable and responsible for a significant chunk of SpaceX's revenue. While Starlink has primarily benefited from rural subscriptions, the expected mass-scale launch of V3 Starlink satellites later this year should enable it to win over suburban broadband users.
Additionally, Musk's space and artificial intelligence conglomerate should receive a boost from newly changed fast-entry index inclusion rules. The U.S. Russell Indexes made SpaceX eligible for inclusion after just five trading sessions. Meanwhile, Nasdaq Global Indexes slashed the wait to Nasdaq-100 inclusion down to 15 trading days.
Required purchasing by index funds and passive exchange-traded funds, when coupled with SpaceX's low float, can fuel an early rally in its shares.
Image source: Getty Images.
History shows SpaceX is more likely to lose 50% (or more) of its value
While Arete is excited about SpaceX's future, historical precedent strongly suggests investors pare down their expectations.
In the weeks leading up to SpaceX's debut, Trust Financial published a data set comparing the performance of 30 of the largest tech-driven IPOs of the last 14 years (i.e., since Facebook, now Meta Platforms, went public). Truist's research showed that the average year-one drawdown for these hyped tech companies was 55%!
Moral of the story-do NOT chase hot IPOs
-- Puru Saxena (@saxena_puru) June 3, 2026
Year-1 average drawdown = 55%
Year-1 median drawdown = 54%
Table: Truist pic.twitter.com/xt864JD4Xh
To build on the above, no company at the forefront of a game-changing innovation has ever maintained a price-to-sales (P/S) ratio above 30 for a lengthy period. SpaceX ended last week at a P/S multiple of nearly 131. Even with rapid sales growth from Starlink and xAI, it would be firmly in bubble territory, based on Arete's lofty price target.
History also tells us that next-big-thing technologies and bubbles go hand in hand. For more than three decades, investors have consistently overestimated the adoption and/or optimization rate of new technologies. While AI infrastructure is being adopted at a breakneck pace, we're likely several years away from businesses optimizing their AI solutions. That's not good news for the AI revolution, SpaceX, or Arete's otherworldly price target.
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Sean Williams has positions in Meta Platforms. The Motley Fool has positions in and recommends Meta Platforms, Nvidia, and Truist Financial. The Motley Fool recommends Nasdaq. The Motley Fool has a disclosure policy.
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