SpaceX Starship Must Deliver to Unlock Nearly 50% Upside

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•  08 Sep 2026
 

$SPCX SpaceX received another bullish Wall Street call, with Pivotal Research initiating coverage with a Buy rating and a $220 price target, implying nearly 50% upside from the current share price. At that target, SpaceX would approach a valuation of about $3 trillion. The optimism is centered mainly on the assumption that Starship will become a truly reusable spacecraft, dramatically lowering launch costs and creating the potential to commercialize new markets.

Unlike some SpaceX forecasts built around a long list of ambitions including satellite internet, artificial intelligence, Mars, defense and data centers in space, Pivotal reduces the story almost entirely to one point: Starship must become a real reusable transportation system. Reusability does not simply mean successfully recovering and launching the vehicle again, but enabling each vehicle to complete 20 to 50 flights, undergo fast and inexpensive servicing, and return to launch. Analyst Jeffrey Vlodek effectively defines this as one enormous engineering bottleneck, with the economics of space changing if SpaceX solves it and the current valuation becoming much harder to justify if it does not.

SpaceX has already changed the launch market with Falcon 9 and its ability to recover and reuse the first stage. Starship is designed to take the same concept several steps further, with both the booster and spacecraft intended for reuse and the ability to carry very heavy payloads at significantly lower cost. According to the Pivotal thesis, full reusability could reduce launch costs by up to 90%, creating not only earnings momentum in the existing launch business but also the possibility of multiple expansion as entirely new markets become economically viable.

The first example is Starlink, which already has more than 12 million users, but continued network expansion requires launching huge quantities of satellites, including newer, larger and more powerful generations. Starship could place much greater capacity into orbit with each launch, lowering the cost per satellite and per user. Pivotal estimates that if the model works, Starlink could capture a significant share of the global wired and wireless communications market, which the firm estimates at about $1.7 trillion.

The next opportunity is data centers in space. If launching payloads into space becomes cheap enough, SpaceX wants to use that capability for AI infrastructure, including data centers in orbit around Earth. One of the largest bottlenecks in the AI revolution is electricity, as data centers require enormous amounts of energy, cooling systems, land and grid connections, while space could theoretically provide nearly continuous solar energy and avoid some of the limitations of terrestrial power infrastructure. But making the concept economical first requires the ability to launch thousands of tons of equipment into space cheaply, bringing the focus back to Starship.

Pivotal sees additional possibilities in industrial manufacturing in space, Earth observation, defense contracts, projects related to the US Golden Dome, energy transmission from space and even passenger flights from one point on Earth to another through a suborbital trajectory. Most of these areas remain far from becoming significant businesses, but all depend on the same basic condition: launch prices must fall dramatically. This also explains why SpaceX is difficult to value, because it can look very expensive compared with a space company or telecommunications company while looking very different if investors believe it is simultaneously building a global internet company, AI infrastructure, a defense provider and a space transportation platform.

SpaceX was listed in June at $135 per share and a valuation of about $1.77 trillion after raising an unprecedented roughly $75 billion. The stock opened its first trading day at $150 and now trades around $145 to $150, above its IPO price but far below the peak above $225 it reached afterward. Much of the initial enthusiasm has therefore already left the stock, but the valuation remains close to $2 trillion, meaning the market is paying not only for Falcon 9 and the existing Starlink business but also for much of what SpaceX promises to become over the next five and ten years.

That is precisely the risk Pivotal highlights despite its Buy rating. If Starship can complete dozens of flights per vehicle at a high rate and with low maintenance costs, SpaceX could open enormous new markets and create powerful institutional flows around a broader long-term growth thesis. If significant refurbishment is required after only a few flights, launch cadence remains low, or operating costs stay high, the economic model changes fundamentally.

The 14th Starship test flight is expected later in September and could include further progress toward full orbital operations. In the previous test, SpaceX successfully deployed 20 advanced Starlink satellites among other achievements, and the company is gradually approaching the point where Starship must move from an experimental project to a commercially functioning system. The upcoming test therefore represents another important catalyst for the Starship thesis.

The Wall Street consensus currently stands at a Buy rating with an average price target above $220. Oppenheimer recently raised its price target to $280, Bernstein stands at $248, and some forecasts are considerably higher. But in the case of SpaceX, the most important numbers may not be $220, $280 or even $3 trillion, but 20 to 50, the number of flights Pivotal assumes each Starship could complete.

If Musk reaches that target, SpaceX could evolve from a giant space corporation into infrastructure on which entire markets are built. If it does not, investors will have to ask how much of the nearly $2 trillion they are paying today is based on an existing business and how much depends on a future that still has to prove it is possible.

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