Nvidia's stock (NVDA) offers far greater price upside through 2028 than SpaceX following a major new AI compute deal between the two firms. Based on financial estimates for 2027, Nvidia trades at just 14.5 times expected future earnings. This price tag makes Nvidia cheaper relative to profits than tech peers like Alphabet (GOOGL) and Amazon (AMZN).

By contrast, Wall Street expects SpaceX (SPCX) to reach $108 billion in sales next year, pricing the rocket maker at 18.5 times future revenue. Paying a low multiple on real profits gives Nvidia a much clearer path for stock gains than buying SpaceX at a high price tag relative to its sales.

SpaceX Commits Exclusively to Nvidia Chips for xAI's Operations

The financial gap comes as the two companies deepen their working relationship. SpaceX's CEO Elon Musk confirmed during the firm's second-quarter earnings call that SpaceX and its xAI division will build software operations exclusively on Nvidia hardware.

Moreover, Musk pointed to Nvidia's Vera Rubin chip design as the top artificial intelligence hardware on the market today. The exclusive deal locks in Nvidia as the only chipmaker powering xAI's Grok model as demand for AI power keeps growing.

Nvidia's Large Profits Contrast with SpaceX's Losses

While both companies hold multi-trillion-dollar market valuations, their quarterly profits show two very different financial pictures. SpaceX generated $7.8 billion in Q2 revenue, up 92% year over year as its AI arm grew 213%. However, the company is still not making a profit, recording a $143 million loss for the quarter.

Meanwhile, Nvidia brought in $96.2 billion in revenue during its latest quarter and turned $63.7 billion of that into net operating income. Nvidia carries a $5.5 trillion valuation compared to $2 trillion for SpaceX, backed by an operating income stream over 12 times larger than SpaceX's total sales.

Is SpaceX or Nvidia the Better Buy?

Wall Street analysts and tracking signals from TipRanks show high targets for both tech giants. SpaceX holds a Moderate Buy rating with a target price of $232.07, showing a potential 56.42% upside from its $148.36 stock price. The rocket maker earns a Smart Score of 9, backed by very positive investor sentiment, even though hedge fund activity stays neutral.

Meanwhile, Nvidia commands a Strong Buy consensus with a price target of $324.32, pointing to a 43.82% upside from its $225.51 share price. Nvidia holds an 8 Smart Score with neutral investor sentiment, while hedge fund signals currently lean negative. Both firms offer strong double-digit growth room, but Nvidia delivers its upside with much lower valuation risk relative to its earnings.