JPMorgan Doubles SpaceX Target to $500 After Record Q3

JPMorgan more than doubled its price target for SpaceX to $500 on October 21, a move that capped a wave of bullish revisions from Wall Street following the company’s third-quarter earnings report. The firm maintained its Overweight rating, reflecting a significant shift in investor confidence after SpaceX disclosed financial results that far exceeded consensus estimates. This adjustment follows a broader trend among analysts who are re-evaluating the long-term growth potential of the company’s expanding business segments.

The financial performance driving these changes was substantial. SpaceX reported third-quarter revenue of $14.6 billion, marking a 161 percent year-over-year increase. This figure comfortably surpassed the $12.7 billion consensus estimate. Profitability also improved dramatically, with the company posting a net profit of $4.4 billion, a stark contrast to the loss recorded in the same period last year. Adjusted EBITDA reached $8.8 billion, further underscoring the efficiency of its operations during this period.

The Super Intelligence division emerged as the primary growth engine, generating approximately $7.6 billion in revenue. This segment experienced nearly 830 percent year-over-year growth, making it the largest revenue contributor for the quarter. Meanwhile, the Connectivity segment delivered $5.2 billion in revenue, driven by strong subscriber additions that expanded the Starlink consumer base to 13.6 million users. These figures highlight the diversification of SpaceX’s income streams beyond traditional launch services.

Management provided guidance that further excited the market. During the earnings call, CEO Elon Musk and CFO Bret Johnsen outlined first-quarter 2027 revenue projections of $33 billion to $37 billion, significantly higher than the roughly $22 billion analysts had modeled. The company also detailed fourth-quarter capital expenditure plans of $35 billion to $40 billion, with a specific focus on AI compute infrastructure in Memphis and Southaven. These investments aim to reach 2.5 to 3 gigawatts of nameplate compute capacity by year-end, with pathways to 13 gigawatts or more by the end of 2027.

Musk emphasized the intense demand from hyperscalers, noting that compute pricing supports payback periods of less than a year, potentially as short as six months. Other highlights from the call included recent orbital successes with Starship, the deployment of V3 satellites, and rapid adoption of Grok Bot. The company also discussed spectrum expansion plans and the formation of special committees to explore a possible combination with Tesla, signaling potential strategic moves ahead.

The reaction in the stock market was immediate. Shares, which closed at $147.79 on October 20, jumped roughly 8 percent in early premarket trading on October 21. Beyond JPMorgan, other major firms raised their targets significantly. Cantor Fitzgerald lifted its target to $345, Barclays to $300, and Wells Fargo to $274. Citi, UBS, and TD Cowen also increased their valuations, with Morgan Stanley maintaining a $300 target. Clear Street adjusted its view to $248.

Analysts broadly cited the strong quarterly print, accelerating AI compute expansion, and progress in Starlink and Starship milestones as key drivers for these higher long-term growth expectations. While the average analyst price target has moved higher, reflecting greater conviction in SpaceX’s trajectory across launch, connectivity, and AI, elevated spending remains a point of focus for investors monitoring the company’s capital allocation strategy.