Morningstar pegs SpaceX at $63 a share, with a 7% shot at the rosy case

A 'fair value' that already assumes the moonshots land

Morningstar's note argues the SpaceX IPO is overvalued — but the way it gets there is the interesting part. Even handing the company enormous benefit of the doubt, its fair value lands at $63 per share. The thread pulled the load-bearing caveat straight out of the piece:

"Even at $63 per share, we give SpaceX a lot of benefit of the doubt in two of the three scenarios, in which we assume the company can achieve a rapidly reusable Starship rocket enabling multiple launches per week and successfully commercialize data centers in space." — a commenter quoting the report

The downside scenario is blunt: orbital data centers "won't work or offer any advantage over terrestrial ones," and the company, "having invested tens of billions to find this out, would cut bait on the project sometime around 2028, the way management walked away from plans to build multiple small-car factories at Tesla." Morningstar assigns the fully-rosy case — reusable Starship and scaled orbital data centers — only a 7% chance.

A rocket company priced almost entirely as an AI bet

The reason a space valuation hinges on data centers is in SpaceX's own filing. A reader who read the S-1's market sizing reproduced the three total-addressable-market figures the valuation rests on:

The AI figure breaks down further — about $22.4T in AI enterprise applications, $2.4T in AI infrastructure, $760B in subscriptions (e.g. Grok) and $600B in digital advertising. Put next to the space number, the point lands itself: a later comment noted SpaceX "is being valued based on Musk's claim that the market for their AI is the entire GDP of the United States," with space at roughly 1% of the addressable market. As one reader put it, the actual business under the hood is "mostly a rental service for some GPUs that were hoarded" — the same ~$2B/month from Anthropic and Google that runs through xAI.

The orbital data center: napkin math the thread couldn't make work

The project Morningstar is being generous about drew the most technical skepticism. A commenter who ran the mass budget put a single orbital data center — solar, radiators, compute, structure — at roughly 6,500 tonnes, or 40-65 Starship launches at 100-150 tonnes each, just for one. The recurring objection was heat: space is "more of a giant Thermos bottle," so radiating away the waste heat of a GPU cluster in full sunlight is the hard, possibly disqualifying problem.

The counter-argument wasn't about economics at all. A reader argued the real driver is permission: with ~70% of the public skeptical or hostile to data centers, "that's why you go 'up'" — orbit sidesteps NIMBY fights and drone-attack risk entirely. Whether that's worth tens of billions is exactly what Morningstar's 7% is pricing.

The governance line buried in the prospectus

Beyond valuation, the thread surfaced a control structure several readers called disqualifying. A commenter quoting the filing laid it out:

"Musk holds over 85% voting power through Class B super-voting shares (10 votes/share). Public investors combined will have 15%… CEO removal = his consent. You can't fire him even if he destroys the company." — a reader citing the prospectus

That framed the harder objection: even if the cash flows arrive, holders can't direct them. "Will he pay out dividends, or will he spend everything on a mission to mars at a massive loss," one reply asked. A defender pushed back that voting control "doesn't change management's fiduciary duty," and that founder control "worked out fine for Alphabet shareholders."

Why 'overvalued' may not matter

The most uncomfortable thread in the discussion was that the analysis could be entirely correct and still irrelevant. A reader pointed out index funds like QQQ and large-cap trackers "will be forced to buy up massive volumes of shares" once it lists — hundreds of billions in mechanical demand independent of any fair-value number. Another commenter put the mood bluntly: everyone thinks it's overvalued, "and the fact that it doesn't matter and won't impact demand for shares illustrates how… untethered the stock market is from reality." Morningstar's $63 and its 7% may be the most honest number in the room — and the one the market is least obligated to care about.