SpaceX (SPCX.US) is not just a rocket company! Morgan Stanley is bullish on its space AI and distributed computing layout, maintaining an "Overweight" rating and a $300 price target.

Morgan Stanley noted in its latest research report released on October 13 that SpaceX's (SPCX.US) long-term development potential extends far beyond rocket launches and satellite internet, and its layout in artificial intelligence, Siasun Robot&Automation, energy infrastructure, and space computing could drive the company to become an important infrastructure provider for the next-generation intelligent economy. The bank believes that the market has not yet fully recognized the growth potential of SpaceX's distributed AI inference network, and therefore maintains its "Overweight" rating and $300 price target. Compared with the closing price of $163.42 on October 12, this price target implies about 84% upside potential. Morgan Stanley analyst Adam Jonas and his team said that SpaceX's business scope is extremely broad, and investors may easily focus excessively on specific businesses such as rocket launches and satellite manufacturing while overlooking the overall strategy behind these layouts. Currently, SpaceX is not only engaged in rocket launches, but is also building launch sites, ground communication stations, and data centers, and manufacturing satellites, communication terminals, spacecraft, and CECEP Solar Energy panels. At the same time, the company plans to produce blades for power generation turbines to shorten the cycle for building power infrastructure, and is working with partners to advance domestic U.S. semiconductor manufacturing, covering memory chips and logic chips. In addition, SpaceX is also acquiring telecom spectrum, developing advanced AI models, and exploring the construction of space AI infrastructure through a distributed orbital cloud. The bank believes that SpaceX has formed a highly vertically integrated system spanning multiple fields including space, communications, artificial intelligence, and energy, with its business layout aimed simultaneously at consumers, industrial enterprises, and the national security market. In the bank's view, the key to understanding SpaceX's long-term strategy lies in the interrelationship among energy, artificial intelligence, and Siasun Robot&Automation. Morgan Stanley pointed out that as large numbers of Siasun Robot&Automation with computing, perception, communication, and autonomous action capabilities become interconnected, limited energy input may also generate enormous intelligent output. This formula is not a strict physical law, but rather a strategic framework used to describe the potential scale effects of distributed intelligent networks. Under this vision, hundreds of billions of physical AI agents may appear on Earth and in near-Earth space in the future. These agents will be equipped with energy, computing power, cooling, sensors, motion control, and communication equipment, and will be interconnected through ground and space infrastructure. The bank said that SpaceX's entry into the telecom market may be aimed not merely at becoming a traditional mobile network operator, but at providing infrastructure for future data transmission among massive numbers of Siasun Robot&Automation and AI devices. The bank expects that with the large-scale adoption of physical AI agents, future wireless network data transmission demand may grow by several orders of magnitude, even reaching more than 10,000 times current levels. Against this backdrop, the distributed inference cloud that SpaceX is advancing may become one of the company's businesses with the greatest growth potential but currently insufficient investor attention. Unlike traditional centralized data centers, the distributed inference cloud aims to achieve intelligent processing through large numbers of interconnected devices and computing nodes, distributing AI computing power more broadly throughout the physical world. Morgan Stanley believes that as traditional data center construction faces challenges in energy supply, regulation, and social acceptance, the importance of distributed AI infrastructure may rise further. As the deployment density of physical AI agents continues to increase, the collaborative processing capability of the entire agent network will also strengthen, thereby pushing the superintelligent economy and the physical intelligence economy into a new growth phase. The bank even used an ant colony as an analogy: a single ant has limited capabilities, but large numbers of ants can form a group with complex collaborative capabilities through information sharing. In the future, tens of billions or even hundreds of billions of physical and digital AI agents may also achieve similar group collaboration through high-speed communication networks. The bank expects that distributed inference clouds and physical AI clusters are expected to become important topics of investor discussion in the coming year. From a valuation perspective, Morgan Stanley believes that SpaceX's enterprise-level AI business may still be undervalued by the market. The report noted that at a share price slightly above $160, the implied price-to-sales ratio of SpaceX's enterprise-level AI business is only in the low single digits. Morgan Stanley estimates that assuming $50 of value per watt of AI computing capability, an incremental margin of 70%, and a 10x EBITDA valuation, then each additional 1 gigawatt (GW) of rated computing power could contribute about $27 per share to SpaceX's valuation, equivalent to 15% to 20% of the current share price. However, the bank expects that by the end of 2027, SpaceX's AI computing power will be about 4.9 gigawatts, still below the company's stated target of close to 10 gigawatts. Morgan Stanley said that SpaceX's fundamental growth momentum in the three major areas of space, communications, and enterprise-level AI is strengthening, and after the release of second-quarter results, the bank's judgment on the company's prospects has also become more optimistic. Within the $300 price target, Morgan Stanley assigned SpaceX valuations of $8 per share for its space business, $118 for its communications business, $8 for X and Grok, and $165 for its enterprise-level AI business. It can be seen that enterprise-level AI has become the largest contributing business segment in the bank's valuation model, followed by satellite communications. The bank also emphasized that SpaceX's long-term growth prospects still face execution risks, including slower-than-expected progress in Starship rocket reuse, slowing Starlink user growth, insufficient commercialization capability in enterprise-level AI, and higher-than-expected AI infrastructure capital expenditures and computing costs. In addition, prolonged power infrastructure construction cycles, increased financing needs, and regulatory approval delays could also put pressure on the company's valuation.