Morgan Stanley analyst Adam Jonas maintains a buy-equivalent rating and a $300 price target on Space Exploration Technologies Corp (NASDAQ: SPCX), warning that investor expectations of a decline to $100 imply zero or negative value for the company’s artificial intelligence business. Jonas argues the current sell-off is overdone, creating an attractive entry point as fundamentals remain largely unchanged despite bearish sentiment. This valuation disconnect directly impacts the performance outlook for single-stock leveraged exchange-traded funds tied to SpaceX.

The bank’s thesis assigns more than half of the $300 target to SpaceX’s AI operations, including Grok and Cursor. Jonas noted that many investors anticipate the stock falling toward $100 once insider lockups expire next month. At that level, the market would be assigning no value to the AI segment. The average analyst price target for SpaceX stands at $278, implying potential growth to a valuation exceeding $3.5 trillion over the next year, according to Bloomberg.

Leveraged ETF Implications

The divergence between Morgan Stanley’s bullish view and broader market skepticism creates significant volatility for single-stock leveraged ETFs. Funds such as the Leverage Shares 2X Long SpaceX Daily ETF (NYSE: SPCH), GraniteShares 2x Long SpaceX Daily ETF (NYSE: SPCG), and T-REX 2X Long SpaceX Daily Target ETF (NYSE: SPAX) seek to deliver twice the daily return of SpaceX shares. These products are highly sensitive to shifts in investor sentiment regarding the AI business.

Conversely, inverse products like the Leverage Shares 2X Short SPCX Daily ETF (NYSE: SSPC) and GraniteShares 2x Short SpaceX Daily ETF (NYSE: SNK) could continue outperforming if the stock drifts toward the $100 level. The outcome depends heavily on whether investors view AI as a cash-intensive burden with uncertain economics or a high-value growth driver.

Volatility Drives Trading Activity

Regardless of the directional bias, recent turbulence benefits ETF issuers through increased trading volumes. Single-stock leveraged ETFs function primarily as short-term trading instruments, deriving appeal from daily price movements rather than long-term trends. SpaceX demonstrated this volatility by soaring nearly 50% in its first three trading sessions before surrendering most gains over the following month. Such swings typically drive tighter spreads and greater usage of both leveraged long and inverse products, mirroring activity seen in ETFs linked to Tesla, Nvidia, and MicroStrategy.

Valuation Divergence

The core conflict lies in the valuation of SpaceX’s AI ambitions. While Morgan Stanley believes the market undervalues this segment, most investors contacted by the bank heavily discount it due to massive capital requirements and an uncertain path to profitability. This debate will likely keep SPCX, SPCG, SPCXX, SPCXD, and SPCS among the most closely watched single-stock ETFs as traders express either confidence in the bullish outlook or skepticism about premium valuations.

Space Exploration Technologies Corp. (NASDAQ: SPCX) successfully completed its 13th Starship test flight, validating critical thermal protection systems under increased stress conditions. CEO Elon Musk confirmed on July 25, 2026, that the vehicle was intentionally accelerated to higher levels to test how well heat shield tiles remained attached during high dynamic pressure. The successful validation marks a key milestone in the rocket's development, demonstrating improved structural integrity and control capabilities for future orbital missions.

The flight operations proceeded as planned from Starbase, Texas. After achieving orbit, the Starship V3 rocket deployed 20 Starlink V3 satellites. Following the payload deployment, the vehicle guided itself using its four flaps to a pre-planned splashdown zone in the Indian Ocean. Musk emphasized that the primary objective of this specific test profile was to assess tile adhesion limits, stating, "Test was successful."

Operational and Market Context

Despite the technical success, Space Exploration Technologies Corp. shares have experienced significant volatility since its June IPO. The stock reached a high of $225/share but has since declined, trading at approximately $114/share, well below its IPO price of $135/share. This downward pressure contributed to a reduction in Elon Musk’s net worth, causing him to lose the title of world’s first trillionaire amid broader selloffs in both SpaceX and Tesla Inc. (NASDAQ: TSLA).

Investor Sentiment

Prominent investor Ross Gerber of Gerber Kawasaki publicly backed the company despite the recent price declines. Gerber described SpaceX’s activities as "incredible" and urged investors not to bet against the firm. He drew parallels to early Tesla volatility, suggesting that short-term price action should not overshadow long-term operational achievements.

Lunar Landing Dynamics

In related commentary, Musk addressed concerns regarding lunar landing stability. Responding to user @SpaceNews92 on July 26, 2026, Musk noted that landing and remaining stable on the Moon is easier than on Earth due to the absence of wind. He highlighted that enhanced structure and mass distribution in the Starship V3 design have mitigated risks associated with tipping over on uneven lunar surfaces.

Flight Test Summary

What the Numbers Show

The divergence between SpaceX’s operational successes and its market valuation highlights a period of investor reassessment. While the company achieves complex engineering milestones such as controlled splashdowns and satellite deployments, the stock trades at an 16% discount to its IPO price. This suggests that market participants are currently prioritizing near-term profitability or revenue visibility over long-term capability demonstrations, creating a potential misalignment between technical progress and equity performance.