Morgan Stanley believes the recent decline in SpaceX shares has created a compelling opportunity for investors, arguing that the market is assigning little or no value to the company’s artificial intelligence operations despite continued confidence in its long-term growth prospects.

Following a volatile debut after its record initial public offering, SpaceX shares have retreated as investors reassess valuations across the artificial intelligence sector amid rising geopolitical risks, higher oil prices, and concerns over sustained capital expenditures.

Analyst Sees Attractive Entry Point

Morgan Stanley analyst Adam Jonas reiterated his bullish stance on SpaceX, maintaining a $300 price target despite the stock’s recent decline.

According to Jonas, many investors expect additional selling pressure when insider lockup restrictions begin expiring next month. He argues that if shares were to fall toward $100, the market would effectively be valuing SpaceX’s artificial intelligence business at little or no value.

Morgan Stanley attributes more than half of its valuation estimate to SpaceX’s AI operations, while the remainder reflects the company’s established launch services, satellite connectivity, and broader aerospace businesses.

The analyst believes current market sentiment has become considerably more negative than the company’s underlying fundamentals.

AI Spending Remains the Primary Debate

Investor caution toward SpaceX mirrors a broader shift across the technology sector, where companies investing aggressively in artificial intelligence infrastructure have experienced increased scrutiny.

Markets have become more selective as rising capital expenditures raise questions about future returns, particularly given uncertain timelines for monetizing next-generation AI technologies.

Morgan Stanley noted that many institutional investors continue to discount the value of SpaceX’s AI initiatives due to significant infrastructure spending requirements and uncertainty surrounding long-term economics.

Nevertheless, the firm believes the company’s AI platform represents an important future growth driver that is not fully reflected in current market pricing.

Wall Street Maintains Positive Long-Term Outlook

Despite recent share price weakness, analyst sentiment toward SpaceX remains overwhelmingly positive.

Most major investment banks covering the company continue to recommend buying the stock, with consensus price targets suggesting substantial upside from current trading levels.

Supporters of the investment thesis argue that SpaceX occupies a unique competitive position by combining leadership across commercial space launches, satellite communications, and artificial intelligence infrastructure.

However, investors continue monitoring several near-term risks, including insider share sales following lockup expirations, elevated AI investment costs, macroeconomic uncertainty, and ongoing geopolitical tensions that have weighed broadly on growth-oriented technology stocks.

Looking ahead, SpaceX’s ability to demonstrate meaningful progress across both its traditional aerospace businesses and emerging AI operations will likely determine whether investor confidence improves. As broader market conditions stabilize and AI investment trends become clearer, analysts expect execution on long-term growth initiatives to remain the primary driver of valuation.