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Tech bull Dan Ives of Wedbush initiated coverage of SpaceX (SPCX) with an Outperform rating and a $190 price target, weighing in on a stock that has whipsawed investors in the three weeks since its record-setting initial public offering. Ives sees SpaceX as a player in the hyperscaler wars too. 

Ives and the Wedbush team see SpaceX as a three-way bet on launch, connectivity, and artificial intelligence. SpaceX is "one of the most differentiated assets within the tech market," Ives wrote, and is "well-positioned to become a major hyperscaler with its vertically integrated platform across connectivity, launch, and AI infrastructure." 

The $190 target implies around 12% upside from Tuesday's close of $171, but the stock dipped in early trade Wednesday.

Today's weakness aside, Ives built his bull case on the three business lines separately. 

Starlink, the satellite broadband unit, remains the profit engine, with roughly 12 million subscribers as of June 5 and average revenue per user near $66. He argued the company holds less than 1% of the global telecom and broadband market, leaving a long runway. 

The launch business, by contrast, he described less as a profit pool than as an internal cost center (though efficient) that makes everything else possible. SpaceX flew about 170 missions in 2025 and lofted 2,213 metric tons to orbit, more than the rest of the world combined, leaving it "less the leading provider than the market itself, with everyone else competing for the remainder."

Ives reserved his richest valuation multiple for AI and compute, the vertical he said anchors the sum-of-the-parts, as did SpaceX did itself in its IPO prospectus. That business recently booked big compute deals in the neighborhood of $28 billion annually, led by deals with Anthropic and Google using SpaceX's Colossus data centers for AI compute for products like Claude and Gemini, respectively. 

The so-called hyperscalers like Amazon Web Services (AMZN), Microsoft Azure (MSFT), and Google's (GOOGL) Cloud unit run global, multi-client cloud platforms offering self-service and a software stack (databases, networking, managed services) sold on demand. Ives admits that SpaceX is not a traditional hyperscaler, as it doesn't offer all the solutions of, say, AWS or Azure, but it can rent out its compute cluster, offloading excess compute as a revenue generator. 

SpaceX's advantage is that it owns a gigawatt-scale compute cluster, Ives said, and the company can build more of it more quickly and cheaply than anyone else. The drawbacks of its compute deals are that they are cancellable within 90 days, making them less durable than traditional multiyear deals. 

Ives also flagged X, the social platform Elon Musk folded into the company, as "the proprietary data and distribution engine that makes the SpaceX AI stack more defensible." 

The bull case also hinges on Starship, the next-generation rocket Ives called "the single largest source of value in the franchise as much as its largest risk." But the rocket has flown 12 test flights, has yet to demonstrate in-orbit propellant transfer as it is designed to do, and faces regulatory pressure that could delay payload deliveries slated for the second half of 2026. 

Ives characterized SpaceX's mounting losses as "an investment cycle, not a business losing ground," while acknowledging that the AI-compute economics underpinning his target depend on Starship performing. 

Investors may consider that "investment cycle" differently, as SpaceX booked a big adjusted EBITDA loss last quarter and will likely do so again.

While SpaceX shed much value following its blockbuster IPO, the stock has since clawed back much of the loss, trading around $171 on Wednesday before pulling back. 

Another bull catalyst for SpaceX could be coming soon. The company is set to join the Nasdaq-100 index before the market opens on July 7, an unusually fast inclusion that JPMorgan estimates could draw about $4.3 billion in buying from index-tracking funds.

Pras Subramanian is Lead Transportation Reporter for Yahoo Finance. You can follow him on X and on Instagram.

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