SpaceX Is Down More Than 40% From All-Time Highs. Here's What a $10,000 Investment Will Be Worth If Wall Street Analysts Are Correct

Space Exploration Technologies Corp (NASDAQ: SPCX) went public with a pop.

After listing at $135 per share, the stock quickly jumped, reaching an intraday high of $225. However, about six weeks after its initial public offering (IPO), SpaceX is experiencing a post-debut hangover, with shares down more than 40% to $116 (as of July 28).

This is by no means the end of the road for SpaceX, and no one truly knows what will happen to the company during the next five years. In fact, Wall Street analysts are bullish on the stock.

Here's what a $10,000 investment in SpaceX could be worth if Wall Street is correct.

Image source: The Motley Fool.

SpaceX's valuation hinges on AI

Few deny that SpaceX is a great company with tremendous potential. The question is: What are the company's assets truly worth?

SpaceX has three core businesses. There's the launch business, which makes everything else at the company possible. There's Starlink, SpaceX's low-Earth-orbit satellite internet service that can provide high-speed access in areas without good connections to traditional internet infrastructure.

Then there is the artificial intelligence (AI) division, which has a wide umbrella. AI houses the social platform X, Grok intelligence, SpaceX's data centers, a future terafab facility, and future enterprise applications that the company produces. It's this division that will make or break the stock.

According to SpaceX's registration statement, the AI division has a total addressable market (TAM) of $26.5 trillion.

However, SpaceX needs to get its reusable, super-heavy-lift rocket Starship fully operational to power everything it wants to achieve, including the further build-out of Starlink and the development of orbital data centers, which have the potential to quickly gobble up a significant share of the AI compute market.

Wall Street is bullish

Of the 31 Wall Street analysts who have issued price targets on SpaceX since it went public and even before, 23 have a buy rating on the stock; seven say hold; and one says sell. The average price target of roughly $235 per share implies more than a doubling for the stock during the next year, according to TipRanks.

In this scenario, a $10,000 investment turns into more than $20,000 in about 12 to 18 months.

However, there is a wide dispersion among this group of analysts, showing that SpaceX is clearly more of a battleground stock at this valuation. Before its IPO, Morningstar analyst Nicolas Owens issued a sell rating and a $63-per-share price target.

Notably, Owens said that even in its most optimistic scenario, in which the company would be worth nearly $2 trillion, or $154 per share, he and his team would grant the company many of its assumptions, including that Starship could achieve multiple launches per week, or even one a day.

In this scenario, Morningstar also assumes that orbital data centers are operational and that SpaceX provides 11.6 gigawatts of AI computing capacity, generating $225 billion in annual revenue.

On the other end of the spectrum, Raymond James' analyst Brian Gesuale is by far the most bullish analyst on the Street, assigning SpaceX an $800 price target and valuing the company at about $10 trillion.

Gesaule called the company "the most significant infrastructure convergence since the advent of the Internet," one that will be as influential as the advent of railroads or electricity.

He also foresees SpaceX's rockets and Starship evolving into a "commercial aviation-like" operation with "continuously declining unit costs."

Gesuale is projecting more than $837 billion in revenue by 2031, with $696 billion in EBITDA (earnings before interest, taxes, depreciation, and amortization), implying a 27 times discounted cash flow exit multiple based on 2031 EBITDA.

In my mind, it's still too early for investors to have enough information to make a wise decision on the stock, given the sheer number of variables. My advice would be to continue waiting and gathering information, or to only take a small, speculative position at this time.

Even if SpaceX achieves everything it hopes, it will likely take much longer than expected.

Bram Berkowitz has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.