Space Exploration Technologies Corp. (NASDAQ:SPCX) is moving forward with an ambitious execution plan. The company expects to conduct another Starship test flight this month, along with the deployment of upgraded Starlink satellites and upper-stage recovery attempts in the coming weeks. Even so, investors were more concerned about its financial trajectory than the technical milestones. Despite posting earnings above Wall Street expectations, the stock fell 8% as investors focused on SpaceX’s exceptionally high spending. Even though the stock price has now recovered, the immediate reaction suggested the market is questioning whether the company can execute its ambitious plans quickly enough to overcome the regulatory hurdles and heavy capital requirements that have historically limited aerospace businesses.
SpaceX’s Next Goal: One Starship Launch Every Day
Elon Musk used SpaceX’s first-ever earnings call to outline the company’s next major milestones. It plans to launch Flight 14 this month, marking the first deployment of upgraded Starlink satellites into orbit while attempting the program’s first upper-stage landing recovery. Success would mark an important milestone not only for NASA’s lunar program but also for the company’s long-term commercial roadmap.
Looking further ahead, CEO Elon Musk has said that SpaceX aims to reach one launch per day within the next year:
We expect the cadence of flights to be increasing rapidly. And probably a year from now, we will be doing at least 1 flight a day, possibly more.
If those milestones are met, it could significantly reshape space access and strengthen its position as the leading heavy-lift launch provider for both commercial and government customers.
Rising Costs And Supply Overhang Temper The Bull Case
Although Space Exploration Technologies Corp. (NASDAQ:SPCX) delivered solid earnings, analysts have become more cautious on the stock. For instance, Piper Sandler lowered its price target from $156 to $140 while keeping a Neutral rating on August 4. The analyst argued that several structural challenges now outweigh the company’s short-term momentum. One of the firm’s primary concerns is that the number of tradable shares is expected to increase by more than 140% as the lockup period expires, which could cause significant pressure on the stock price due to increasing supply.
Piper Sandler also raised its FY27 capital spending forecast to around $65 billion, roughly $17 billion higher than its earlier projection. The increase underscores the enormous investment needed to execute the company’s growth strategy. Moreover, the firm also cautioned that AI cloud contracts remain cancelable despite their attractive profitability. This makes future revenue less predictable. These concerns suggest that achieving SpaceX’s long-term operational goals could require significantly higher capital spending than previously expected.
SPCX currently has a short interest of 2.67%. However, considering the fact that the company went public just over a couple of months ago and only just announced its first quarterly earnings, these numbers do not carry any significant meaning. It will be interesting to see how the hedge funds decide to bet on or against Elon Musk’s ambitions, as those who shorted Tesla (NASDAQ:TSLA) haven’t had any significant success to talk about.
While we acknowledge the risk and potential of SPCX as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than SPCX and that has 10,000% upside potential, check out our report about this cheapest AI stock.
READ NEXT: 33 Stocks That Should Double in 3 Years and 15 Stocks That Will Make You Rich in 10 Years
Disclosure: None. Follow Insider Monkey on Google News.
