Investment bank Oppenheimer Holdings Inc. (NYSE:OPY) has launched the first coverage of commercial space flight company SpaceX on Wall Street, predicting a near 41% upside for the Elon Musk-led company ahead of Friday’s IPO.
Oppenheimer Sets $190 Price Target
In a new investor note released on Thursday, the investment bank set a price target of $190 for SPCX, a nearly 41% upside compared to the IPO offer price of $135/share.
The note said that the bank saw potential for SpaceX to “leverage terrestrial compute expertise” to help its expert system. “We see it as the only vertically-integrated AI company with the required capital, data, LLMs, hardware, manufacturing and engineering talent,” the bank said.
Oppenheimer said it expects SpaceX to become the “largest” communications and AI company, but warned of “extreme stock and operational volatility” as well as challenges related to manufacturing that could make it fall behind schedule.
SpaceX IPO
Investor Gary Black of The Future Fund LLC said that the IPO could result in Tesla Inc. (NASDAQ:TSLA) shareholders exiting their positions in the EV giant to invest in SpaceX. However, the investor termed the company “richly valued” and said that he would avoid the IPO.
Sen. Elizabeth Warren (D-Mass), on the other hand, called for delaying the IPO. She warned of "misleading" or "inaccurate" accounting of valuation ahead of the IPO. Warren also added that the IPO could expose investors to improper governance structures.
The Kobeissi Letter, in a post on X, shared that the retail orders for the IPO made up $70 billion, $5 billion shy of the total target of $75 billion Musk aims to raise for SpaceX via the listing.
“Retail interest in SpaceX is now 2.4 TIMES larger than the total amount raised in the previous largest IPO in history,” the post said, referring to 2019’s Saudi Aramco IPO that generated over $29.4 billion.
However, NYU Stern Professor Aswath Damodaran, also called the Dean of Valuation, said that he would avoid participating in the IPO. Damodaran listed concerns with SpaceX’s valuation, as well as the $28.5 trillion market opportunity touted by the company in its prospectus.
Check out more of Benzinga’s Future Of Mobility coverage by following this link.
Photo courtesy: Shutterstock
Login to comment