Morgan Stanley has stated that SpaceX (SPCX.US)'s upcoming 15th Starship flight mission could mark an important step toward full reusability of its next-generation rocket, potentially expanding the company's opportunities in satellite communications and artificial intelligence (AI).
In a research report released last Sunday, lead analyst Adam Jonas reiterated an "overweight" rating on SpaceX and a $300 price target, implying roughly 84% upside from the stock's Monday closing price of $163.42. Jonas said the next two Starship missions could reshape investors' expectations for the company's growth prospects.
It is understood that the 15th test flight is tentatively scheduled for November 8 local time and could include an attempt to catch the returning Starship vehicle using the launch tower's mechanical arms. SpaceX CEO Elon Musk recently said the company wants to attempt this operation, but it has not yet been confirmed. According to preliminary air traffic control notice information cited by Morgan Stanley, the 16th test flight could take place as early as December 10. Neither date has been confirmed by SpaceX.
For investors, the significance goes beyond the technical achievement of recovering the vehicle. If reusable technology is realized, launch costs will fall substantially, and the payload SpaceX can send into orbit in a single launch will also increase significantly, thereby improving the profitability model of its Starlink satellite network and supporting the company's expansion into emerging tracks such as orbital computing power and space manufacturing.
Morgan Stanley estimates that a single Starship mission carrying next-generation Starlink satellites could deploy a scale of bandwidth equivalent to one to two months' worth of total launches by the Falcon 9 rocket. The report said each Starlink V3 satellite's downlink bandwidth capacity is about 10 times that of the V2 Mini satellites launched by Falcon 9. After deploying 26 Starlink V3 satellites on the 14th test flight, Jonas expects the next mission to carry a similar or even larger payload. Starship can carry up to 60 such satellites, providing an opportunity to accelerate deployment while reducing the number of launches needed to expand the Starlink network.
The analyst warned that technical challenges remain severe, especially engine failures that have repeatedly appeared in recent Starship test flights. Three launches involving the V3 configuration all experienced booster engine issues before splashdown, and two of them also had spacecraft vacuum engine failures. Although the number of booster engines successfully ignited in landing attempts has improved, further setbacks would delay progress on hardware reuse and limit the launch cadence in 2027.
Morgan Stanley does not expect SpaceX to attempt to catch the booster on the 15th test flight, citing the engine failure in the previous mission. However, the firm lists successfully recovering both the spacecraft and booster in a single test flight and subsequently achieving V3 hardware reuse as an important milestone toward achieving the program's commercial goals.
The firm's $300 price target reflects a sum-of-the-parts valuation, with the connectivity business at $118 per share, enterprise AI at $165 per share, the external launch business at $8 per share, and X platform and consumer AI businesses accounting for another $8 per share. This valuation highlights Morgan Stanley's view that Starship's biggest financial contribution may come from driving growth in other businesses rather than from commercial launch revenue alone.
Jonas estimates that at a price of about $160 per share, investors value SpaceX's launch and connectivity businesses at about $127 per share, with only about $33 attributable to AI. This implied AI valuation is about 3 times the 2028 expected enterprise value-to-sales multiple of a certain cloud infrastructure business, indicating that the stock has substantial upside if the company successfully executes its computing power strategy.
Morgan Stanley noted that further progress in Starship development, new AI product launches, and additional cloud infrastructure contracts priced at about $30 to $50 per watt are potential catalysts that could drive the stock toward the $300 price target. The firm also believes that expanding satellite connectivity and deploying computing infrastructure in orbit present opportunities.
The report pointed out that a decline in the stock price to around $100 over the next 12 months would most likely require several conditions to be met simultaneously: a significant slowdown in AI development, a major Starship test failure, and large-scale equity dilution. Other risks include Starlink user growth falling short of expectations, rising infrastructure capital expenditure, regulatory approval delays, and weaker-than-expected monetization of enterprise AI services.
Morgan Stanley forecasts SpaceX earnings per share of $0.55 in 2026, rising to $2.54 in 2027 and $6.01 in 2028. These estimates imply a sharp acceleration in profitability, although the company's valuation still depends on ambitious growth assumptions and successful execution across multiple businesses. The firm's core argument is that progress toward full reusability of Starship could become an important driver of this growth, and the 15th test flight will provide an initial test of whether these expectations can be realized.
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