Space Exploration Technologies (NASDAQ:SPCX) stock has plunged to a record low as its post-IPO rally lost momentum. The stock ended the week at $145, down 35% from its highest level this year, while its market capitalization has fallen from a record $2.68 trillion to $1.93 trillion. Still, analysts believe the stock has more upside over time.

Analysts are Optimistic About SpaceX Stock

Most Wall Street analysts tracking SpaceX have a favorable rating on its shares. Benzinga data shows that the consensus target for the stock is $237, up by 65% from the current level. 

Canaccord Genuity has a price target of $245, while Goldman Sachs (NYSE:GS), Wells Fargo (NYSE:WFC), Citigroup (NYSE:C), and Morgan Stanley (NYSE:MS) have set price targets of $205, $230, $200, and $300, respectively. The most bullish analysts are from Raymond James, who have a target of $800.

The general view among analysts is that SpaceX is a major player in some of the biggest industries today. It is the largest name in broadband internet through its StarLink solution. It has also become a top player in the satellite launch industry. 

SpaceX also owns xAI, which is made up of X, formerly known as Twitter, and Grok, a large company in the AI industry. Most recently, it has received major deals in the AI dat center industry, with Anthropic paying it over $1 billion a month. Google will start paying it $925 million, while Reflection AI will pay it $150 million a month. 

These businesses are expected to boost its annual revenue much higher in the long term. Analysts predict that its annual revenue will jump from $18 billion last year to $38.9 billion this year, and $72.4 billion next year. 

The challenge, however, is that its profitability remains under pressure. While its core business was profitable, its AI ventures are still burning cash. For example, it is a partner with Tesla (NASDAQ:TSLA) in Terafab, a semiconductor project that will cost billions of dollars over time. 

SpaceX Faces Some Potential Risks

Still, despite the optimism, some analysts have questioned SpaceX’s valuation. On the positive side, analysts point to its large total addressable market, which the company pegs at $30 trillion. 

However, some analysts have warned that a $2 trillion valuation, with Morningstar (NYSE:MORN) valuing it at just $780 billion. 

At the same time, there are concerns about the rising competition in some of its key businesses. Jeff Bezos’ Blue Origin has raised cash at a $130 billion valuation as it seeks to become a big competitor to SpaceX. China recently relaunched its first reusable rocket, while Europe is spending billions to build a Starlink competitor. 

Most notably, despite billions of dollars in investment, Grok is yet to gain substantial market share. Data shows that its share is about 5%, with ChatGPT, Claude, and Gemini having the biggest share. 

The next key catalyst for the SPCX stock will be its earnings. While the date has not been announced, estimates are that it will release on August 17. These results will provide more information about its performance.

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