SpaceX shares rose sharply in premarket trading after JPMorgan Chase maintained its buy recommendation on the stock and set a target price of $240, reflecting the potential for a nearly 75% rise from recent trading levels, amid growing optimism about the company's expansion into artificial intelligence.
Doug Anmuth, an analyst at JPMorgan, said the bank has become more optimistic about the prospects for SpaceX's artificial intelligence business, especially after the company's acquisition of Anthropic, the developer of the Cursor platform, for $60 billion in an all-stock deal.
The bank believes the completion of the deal represents a significant step in developing SpaceX's enterprise AI business, following Cursor's data showing a marked improvement in training modern Grok models. The Cursor platform provides AI tools that help developers write, modify, and troubleshoot software.
Cursor's customer base includes more than 50,000 companies, and estimates cited by JPMorgan indicate that the platform's products are used by about two-thirds of Fortune 500 companies. The bank believes that this base could give SpaceX a direct channel to reach corporate customers and market Grok services to them.
JPMorgan also pointed to the performance and cost of the Grok 4.6 model compared to some competing services, suggesting these factors could support its adoption in the enterprise sector. In a separate assessment, Bernstein Bank described Grok as a potential game-changer for SpaceX.
These projections do not mean that the deal has already been reflected in the company's financial results; Cursor's contribution to revenues or operating costs is not yet clear, making future financial disclosures more important for assessing the economic return of the acquisition.
Meanwhile, SpaceX faces another factor that could influence its stock price: JPMorgan expects approximately 370 million shares to become eligible for trading on September 9th and 10th, potentially increasing the number of shares available for trading by about 20%. This doesn't necessarily mean all of these shares will be sold, as the actual selling pressure depends on the decisions of the shareholders.
This comes after trading restrictions on hundreds of millions of shares ended in August, without the increase in available shares necessarily turning into an immediate sell-off, highlighting the importance of distinguishing between shares eligible for trading and shares that are actually offered on the market.
The $240 price target is based on JPMorgan's expectations for AI business growth, but it remains an estimate from the bank and not a guarantee of the stock's performance. Institutional valuations vary, reflecting differing assumptions about SpaceX's value and its ability to translate its AI expansion into actual revenue growth.
