SpaceX (SPCX): Fresh Catalysts Ahead

SpaceX: Following the Mega-IPO Pattern

History teaches investors that buying shares of a stock on or near an initial public offering can lead to fast, deep drawdowns. According to 30/40 Wealth, more than 70% of tech companies underperform post-IPO. Worse, major tech and high-growth IPOs average a drawdown of more than 50% from peak or initial high trading ranges within the first year.

Although SpaceX (SPCX) was the most highly anticipated and largest IPO in U.S. history, the historical data held. In fact, with SpaceX, the drawdown likely occurred sooner than most other IPOs because early private investors had such windfall profits that using the public market to lock in profits and take some chips off the table was sensible.

Nevertheless, after notching in all-time low of $104.83 in early August, SpaceX shares have finally stabilized – and for good reason. The company currently enjoys a plethora of fresh catalysts that are likely to drive the stock higher into year-end and into 2027, including:

Starship Reaches Orbit for the First Time

Starship is SpaceX’s most ambitious project. The giant, two-stage rocket is the largest human-made flying object and the most powerful rocket ever made. SpaceX has been testing Starship since 2019 but recently reached orbit for the first time. Why is Starship a big deal? Not only is Starship reusable, but it can carry roughly 5-10 times more payload to orbit than a traditional rocket.

SpaceX Scales Starlink

A successful Starship launch will trigger a bullish cascade for SpaceX’s fundamentals. In the recent Starship flight, SpaceX deployed its first 26 next-generation Starlink V3 satellites into orbit. With Starship in action, SpaceX can scale its lucrative Starlink business faster and more affordably.

Data Centers in Space Proof of Concept

One key takeaway from SpaceX’s S-1 was the promise of AI data centers in space. AI data centers in space are far more cost-efficient and eliminate the need to overcome public pushback and regulatory red tape (a growing issue for AI companies). Planet Labs (PL) and Google (GOOGL) just launched the first AI satellite, providing proof of concept for SpaceX’s once-seemingly unrealistic ambitions.

AI Compute Demand is Soaring

However, AI data centers in space won’t happen for years. Nevertheless, xAI’s terrestrial AI business is booming here and now. Recently, AI leader Anthropic expanded its computing agreements with SpaceX, committing up to $84.5 billion through May 2029 for NVIDIA (NVDA)-based AI infrastructure. With Anthropic expected to IPO before the end of 2026, this business is likely to grow further. Zacks Consensus Estimates suggest that SpaceX will grow revenue by a juicy 147% in 2027.

SpaceX / Tesla Merger Potential

The odds of a SpaceX / Tesla (TSLA) merger by the end of next year have spiked to 63% on Polymarket.

A merger would be bullish for SpaceX because it would increase cash reserves, streamline governance under Elon Musk, and increase efficiency through shared AI and hardware.

Bottom Line

With its post-IPO consolidation behind it, SpaceX is positioned for a powerful rebound driven by a successful Starship launch, surging growth in Starlink, and soaring AI compute demand.

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This article originally published on Zacks Investment Research (zacks.com).

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