CFRA initiates coverage on SpaceX with sell rating, setting $115 target well below IPO price

SpaceX barely finished its first week as a public company and Wall Street is already fighting about it. CFRA Research has initiated coverage on SPCX with a Sell rating and a $115 price target, a figure that sits roughly 15% below the company’s IPO price of $135 per share.

A $75 gap between bulls and bears

The spread between analyst targets tells you everything about how divided the Street is on this name. Oppenheimer assigned an Outperform rating with a $190 target on June 11, the day before SpaceX began trading on the Nasdaq. New Street Research landed somewhere in between with a $165 price target.

CFRA’s $115 sits $75 below Oppenheimer’s call. That kind of dispersion on a freshly listed stock is unusual and worth paying attention to.

CFRA analyst Keith Snyder is the one behind the bearish thesis. His pre-IPO research dug into three specific areas: the unit economics of Starlink’s broadband service, the capital intensity of the Starship program, and SpaceX’s nascent push into artificial intelligence.

The IPO targeted a valuation approaching $1.75 trillion when you include the 15% greenshoe option. Retail demand alone reportedly exceeded $100 billion in oversubscription interest.

The IPO that broke the internet

SpaceX’s Nasdaq debut, which took place around June 12, priced at $135 per share. Oversubscription levels were reportedly massive, with retail investor interest alone surpassing the $100 billion mark.

The company’s portfolio spans three major verticals: launch services through its Falcon and Starship programs, satellite broadband via the Starlink constellation, and an emerging AI division.

What this means for investors

The bear case, as articulated by CFRA, centers on valuation discipline. At $1.75 trillion, investors are paying for a future that requires near-flawless execution across multiple capital-intensive programs. Starship development costs remain substantial. Starlink’s unit economics, while improving, still face questions about long-term profitability at scale.

The massive gap between CFRA’s $115 and Oppenheimer’s $190 creates a particularly tricky environment for new shareholders. That $75 spread represents roughly a 65% range relative to the lower target.

Investors who bought at the IPO price of $135 are essentially sitting between two very different visions of what this company is worth. If Snyder’s analysis of Starlink economics and Starship costs proves prescient, those shareholders are looking at meaningful downside. If the bulls are correct that SpaceX’s competitive moats justify a premium, the upside runway extends well beyond the listing price.

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