Three Prices Where SpaceX Stock is a Buy

SpaceX just won't stop going down. To be sure, it was expensive, valued at about $1.8 trillion in its mega-IPO. But there is a price for everything, and the declines will eventually draw buyers looking for a deal.

Tuesday's trading session, SpaceX shares surged, rising over 1%, after initially falling more than 5% in early trading.

Shares keep falling, but when are they a good deal? Barron's has three prices to consider.

SpaceX stock traded as low as $108.66 on Monday, despite a successful Starship test late on Friday. That mark left shares down 52% from their all-time high of $225.64. That peak-to-trough move wiped out roughly $1.5 trillion in market value. The pain has been real.

Shares are very close to the $100 level where Morgan Stanley analyst Adam Jonas believes the company is getting no value for its AI business. And SpaceX's AI business isn't all about pie-in-the-sky orbital data centers. It merged with xAI in February and is renting existing terrestrial computing capacity for billions.

Jonas made that observation on Friday, adding that SpaceX's space launch and space-based broadband business, Starlink, could easily be worth $136 alone. He rates shares Buy and has a $300 price target. (AI accounts for more than 60% of his overall valuation.)

Jonas' $100 price observation isn't too far from the $90 Barron's suggested SpaceX was worth about a week before the IPO. That number was based on inputs from New York University professor Aswath Damodaran, comparisons to other communications and AI companies, as well as some margin of safety since the company's biggest bet -- AI data centers in SpaceX built on the back of the huge, fully reusable Starship rocket -- just isn't science-fact yet.

The third potential stopping point is $63 per share. That is down 53% from the $135 IPO price. That is where Meta Platforms stock bottomed out about four months after its May 2012 IPO.

There is nothing magical about the 53% number. But investors are creatures of habit, and they will start to remember what happened to Meta after it fell. Shares were up about 140% over the next 12 months, and today shares are up roughly 3,250% from the bottom.

Many factors will influence where SpaceX stock bottoms, including the broader market and, of course, how SpaceX executes its business strategy.

Whatever the stock does, SpaceX remains an amazing example of defying the odds to bring disruptive technologies -- in this case reusable rockets -- to the market.