SpaceX: If Elon Musk Were to Become the First Trillionaire, it Won't be Because of Tesla (TSLA)

October 19, 2021 7:37 AM EDT

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Earlier this month, CNBC reported that Elon Musk’s SpaceX crossed a $100 billion valuation after a secondary share sale by insiders.

Shareholders sold up to $755 million in stock at $560 a share to push the valuation to $100.3 billion, up from $74 billion in February.

Morgan Stanley analyst Adam Jonas has weighed in to discuss whether any company in the world can catch SpaceX, which could eventually become the most highly valued company in the world.

“More than one client has told us if Elon Musk were to become the first Trillionaire... it won't be because of Tesla,” Jonas wrote in a client note.

At the core of a very successful business is the Starlink LEO sat comms unit, argues Jonas.

“We have long seen SpaceX as multiple companies in one (launch, comms, space infrastructure, earth observation, deep space exploration, etc.). But the largest contributor to our estimated ~$100bn base case valuation for the company (~$200bn bull case) is the Starlink LEO sat comms business which has had a number of important milestones in recent months. At the same time, what SpaceX is doing on the shores of South Texas is challenging any preconceived notion of what was possible and the time frame possible, in terms of rockets, launch vehicles and supporting infrastructure…”

“We view SpaceX’s launch capabilities and Starlink as inextricably linked whereby improvements in launch capacity/bandwidth (both in frequency and payload per flight) and cost of launch improve the economics and path to scale of Starlink’s LEO constellation. At the same time, development of Starlink’s commercial opportunity provides a thriving ‘captive customer’ for the launch business, enabling a symbiotic development,” the analyst added in a note.



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