RayJay thinks SpaceX will soon be worth $10tn

You might already be gawping at some of the price targets analysts at SpaceX’s sundry underwriters have slapped on the reusable rocket company/stagnant social media company/saviour of our species.

The analysis and forecasts all seem to be competitively superlative: carefully designed to curry favour with Elon Musk, while still offering some plausible deniability to compliance departments that must be a bit nervy by now.

But Raymond James, the big Florida-based wealth manager that snagged a role on the IPO, has cranked things up to the 420nd degree:

We initiate coverage of SpaceX with a Strong Buy rating and an $800 price target, as we see the company as one of the defining industrial infrastructure companies of the 21st century. Industrialized access to orbit and AI are driving the most significant infrastructure convergence since the advent of the Internet. By lowering the cost of transporting mass to orbit, SpaceX is enabling a new infrastructure layer spanning transportation, communications, compute, manufacturing, and energy. Just as railroads, electric grids, and the Internet reshaped prior economic eras, we believe SpaceX is building the foundational platform for the next generation of industrial capacity.

We initiate coverage of SpaceX with a Strong Buy rating and an $800 price target, as we see the company as one of the defining industrial infrastructure companies of the 21st century. Industrialized access to orbit and AI are driving the most significant infrastructure convergence since the advent of the Internet. By lowering the cost of transporting mass to orbit, SpaceX is enabling a new infrastructure layer spanning transportation, communications, compute, manufacturing, and energy. Just as railroads, electric grids, and the Internet reshaped prior economic eras, we believe SpaceX is building the foundational platform for the next generation of industrial capacity.

That $800 price target is more than twice as high as the second most bullish analyst (Adam Jonas at Morgan Stanley, obviously). It’s nearly four times the price target given by lead-left underwriter Goldman Sachs.

In case you’re curious, it implies a SpaceX market capitalisation well north of $10tn — more than Apple and Nvidia combined. It’s about 10 Berkshire Hathaways. If you’re of the international persuasion, it’s roughly the same as the entire Chinese stock market, or France, Germany and the UK’s equity markets combined.

This is based on RayJay’s projections that SpaceX’s annual revenues will exceed $837bn by 2031, while earnings before interest, taxes, depreciation and amortisation will reach $696bn. (FYI, SpaceX’s revenues were $18.7bn last year, when it also recorded a loss of $4.9bn).

Why, you ask? Well:

Starship represents the defining industrial innovation of our generation. Starship reduces the cost of transporting mass to orbit by more than 99%, while increasing payload capacity by an order of magnitude, transforming access to space from a scarce capability into an abundant industrial platform. The premise of our thesis is that Starship successfully industrializes orbital transportation, transforming orbital launch from a bespoke aerospace capability into a transportation network defined by commercial aviation-like operating cadence and continuously declining unit costs. History has shown that structural declines in foundational infrastructure costs — from railroads and electrification to containerization and the Internet — expand economic frontiers, create new industries, and generate decades of value creation. We believe Starship represents the next such inflection point, unlocking a TAM that we estimate approaches $30T.The value of Starship extends well beyond transportation. As launch costs decline, we expect SpaceX to commercialize infrastructure platforms spanning connectivity, AI, national security, manufacturing, and transportation. We view these as interconnected platforms built upon a common industrial foundation. As AI scales, the binding constraints increasingly shift toward the physical systems required to produce intelligence at scale. We believe SpaceX is building the lowest-cost platform for converting electricity into useful intelligence.SpaceX has created a powerful infrastructure flywheel. Each generation of infrastructure funds the next. Falcon funded Starlink. Starlink funds Starship. Starship enables the next generation of platforms. We expect SpaceX to grow from approximately $38.5B of revenue and $17.7B of EBITDA today to more than $837B of revenue and $696B of EBITDA by 2031. As each platform reaches scale, it generates the capital to fund the next while increasing the value of every platform, creating a self-reinforcing capital allocation engine that compounds earnings, EV, and competitive advantage.

Starship represents the defining industrial innovation of our generation. Starship reduces the cost of transporting mass to orbit by more than 99%, while increasing payload capacity by an order of magnitude, transforming access to space from a scarce capability into an abundant industrial platform. The premise of our thesis is that Starship successfully industrializes orbital transportation, transforming orbital launch from a bespoke aerospace capability into a transportation network defined by commercial aviation-like operating cadence and continuously declining unit costs. History has shown that structural declines in foundational infrastructure costs — from railroads and electrification to containerization and the Internet — expand economic frontiers, create new industries, and generate decades of value creation. We believe Starship represents the next such inflection point, unlocking a TAM that we estimate approaches $30T.

The value of Starship extends well beyond transportation. As launch costs decline, we expect SpaceX to commercialize infrastructure platforms spanning connectivity, AI, national security, manufacturing, and transportation. We view these as interconnected platforms built upon a common industrial foundation. As AI scales, the binding constraints increasingly shift toward the physical systems required to produce intelligence at scale. We believe SpaceX is building the lowest-cost platform for converting electricity into useful intelligence.

SpaceX has created a powerful infrastructure flywheel. Each generation of infrastructure funds the next. Falcon funded Starlink. Starlink funds Starship. Starship enables the next generation of platforms. We expect SpaceX to grow from approximately $38.5B of revenue and $17.7B of EBITDA today to more than $837B of revenue and $696B of EBITDA by 2031. As each platform reaches scale, it generates the capital to fund the next while increasing the value of every platform, creating a self-reinforcing capital allocation engine that compounds earnings, EV, and competitive advantage.

To bolster its argument, RayJay’s analysts — Brian Gesuale and Ryan Rackley — also include some Masa Son-esque visuals.

And just to stress, this is Raymond James’s base case. Its bull thesis implies a $1,000 share price.

Not to be outdone by a Florida wirehouse, Alphaville LLC — this blog’s own dedicated investment research outfit — has initiated coverage with a price target of ∞.