SpaceX received a cautious appraisal from KeyBanc Capital Markets, which said the stock’s lofty valuation already reflects much of its long-term growth potential. The investment bank began coverage of the Elon Musk-led, aerospace and satellite company with a Sector Weight rating, equivalent to more than a hold recommendation on Wall Street. It stopped short of issuing a price target for the stock. “SPCX possesses significant disruptive growth avenues, though we believe this is reflected in current valuation and risk/reward appears balanced, in our view,” KeyBanc wrote to clients. Shares of SpaceX are up about 27% from their IPO price of $135, but the stock has fallen more than 20% from its peak, leaving it with a market capitalization of roughly $2.2 trillion, including debt. KeyBanc’s own valuation framework paints a far more cautious picture. SPCX 1M mountain SpaceX since going public In a base-case scenario, the bank estimated SpaceX’s enterprise value at about $1.02 trillion, using discounted future cash flows from Starlink and other connectivity businesses. That’s less than half the SpaceX current enterprise value, suggesting investors are pricing in a far rosier future. At the center of KeyBanc’s hesitation is Starship, the giant reusable rocket that Musk, the CEO, has described as critical to the future of satellite deployment, deep-space exploration and, eventually, colonization of Mars. The bank noted the Starship program has yet to mature and has already suffered setbacks that have pushed back timelines several years. “While we believe Starship will ultimately achieve success, we take a conservative approach on its development timeline,” KeyBanc wrote. “Risk/reward appears balanced until we achieve greater visibility on Starship’s progress.” The Cleveland-based bank also flagged a more immediate concern: the potential impact later this summer of unlocked insider shares. SpaceX came public with only about 5% of its roughly 13 billion shares available for trading, creating one of the smallest floats among mega-cap stocks. KeyBanc said the company’s structured lockup schedule will gradually release additional shares into the market over time, increasing the number of shares available for trading, but also creating “near-term liquidity uncertainty.” — CNBC’s Michael Bloom contributed reporting.
