SpaceX: The Next Frontier

Research evidence excerpt

SpaceX: The Next Frontier

The Next Frontier: Initiating Coverage with an Overweight Rating & $225 PT

Investment Thesis

1• SpaceX’s mission leads to potentially the largest economic frontier ever. Mission to build the systems & tech to

make life multi-planetary; Positioned to go after what SpaceX believes is a TAM of $28T+ across Space, Connectivity,

& AI

2• Launch leadership is the key enabler & differentiator. SpaceX has completed ~670 orbital launches with 99%+

mission success rate across its Falcon rockets & has launched 80%+ of all mass to orbit since 2023; Starship V3

should represent a step function improvement in both affordability & throughput

3• Extreme vertical integration & engineering first culture. Speed/cost advantage is evident across rocket launches,

satellite manufacturing, data center construction, & AI model training, among other areas; Engineering-first culture has

resulted in a series of technological breakthroughs and industry-defining firsts

4• Starlink uniquely positioned to drive broadband market share, though we view mobile as less likely. SpaceX is

the only company that controls the entire satellite value chain in house; Starlink is the world’s largest LEO constellation

with 9,600+ broadband & mobile satellites, serving 12M+ active customers across 164 countries, territories, & other

markets

5• First terrestrial, then orbital – AI forecast to drive SpaceX. SpaceX operates a leading AI infrastructure footprint,

frontier model, & scaled platform for real-time data & distribution; SpaceX continues to ramp terrestrial compute &

appears to be the only company with a commercially viable path to building orbital AI compute at scale

6• Valuation upside supported by strong growth & margin expansion. We initiate coverage with an OW rating & a