SpaceX's recent $1.9 billion funding and the “continued momentum in winning government contracts” were the prime reasons for the jump in its valuation.
Investment bank and financial services company Morgan Stanley has nearly doubled the valuation of Elon Musk’s aerospace company SpaceX from $52 billion in July this year to more than $100 billion, according to a research note issued by the bank earlier this week, Forbes reported. In fact, Morgan Stanley has put SpaceX’s valuation at more than $200 billion in its ‘bull’ case – the most optimistic scenario. According to the research paper, SpaceX: Raising Valuation Scenarios Following Key Developments, its recent $1.9 billion funding and the “continued momentum in winning government contracts” were the prime reasons for the increase in the company’s valuation.
Morgan Stanley called SpaceX the “mission control for the emerging space economy.” The note, written by Morgan Stanley analyst Adam Jonas, read that “the pieces are coming together for SpaceX to create an economic and technological flywheel,” as cited by CNBC. The note added that “It is clear to investors and industry observers that SpaceX’s launch cost advantages are being used to accelerate deployment of its LEO broadband network.”
SpaceX’s low-earth orbit (LEO) satellite-based internet service – Starlink is what would help Musk pull investors and eventually help the company grow further. “The promise of a viable and capable satellite broadband service increases, helping the company attract large amounts of capital at attractive rates, further enabling the development of even more capable launch architectures (Starship) that further deepens and widens the moat in satellite launch costs.”
In the base case scenario, SpaceX’s rockets would be $11.7 billion entity even as Starlink becomes worth $80.9 billion, and the point-to-point space travel (reaching from one city on earth to another in less than an hour via starship) becomes $8.7 billion business. Jonas estimated Starship to cost $5.6 billion – $8 billion to fully develop even as Musk has acknowledged that it would need “hundreds of missions with satellites before we put people on board.”