This Surging Stock Could Have More Upside as SpaceX Moves Toward a Possible 2026 IPO

A SpaceX Starship. EchoStar owns stock in the Elon Musk-controlled company. (Courtesy SpaceX)

Key Points

• EchoStar stock has more than tripled since September, gaining 27% this week after reports of a potential $1.5 trillion SpaceX valuation.
• Morgan Stanley upgraded EchoStar to Overweight with a $110 price target, citing a bull-case of $150 if SpaceX reaches an $800 billion valuation.
• EchoStar’s stake in SpaceX, acquired through spectrum sales, is a key driver for its stock, despite the company’s $26 billion debt.

Surging EchoStar stock could have more upside if SpaceX ends up going public in 2026 at anything close to the reported $1.5 trillion valuation that the Elon Musk-controlled satellite, rocket, and space company could seek.

EchoStar has become the top SpaceX proxy in the public markets since EchoStar sold wireless spectrum to SpaceX in two separate transactions in September and November for a package of cash and SpaceX stock.

EchoStar stock has more than tripled since the initial transaction in September, and the shares have gained 27% to $104.39 this week after Bloomberg reported that SpaceX could seek a $1.5 trillion valuation—the largest of any private company—in a potential 2026 IPO. Musk appeared to confirm plans for a 2026 IPO in a Wednesday post on X.

Morgan Stanley analyst Ben Swinburne upgraded EchoStar to Overweight from Equal Weight on Wednesday with a price target of $110 and a bull-case scenario of $120 a share.

The math on EchoStar stock isn’t simple because the company has a market value of about $30 billion plus some $26 billion of debt. EchoStar stake in SpaceX represents a third of the market cap at current levels, but it’s become the driver of the stock.

The calculations aren’t simple. But here’s why the stock could head even higher.

When EchoStar got the SpaceX stock, it was done at what the companies called a September 2025 valuation of SpaceX without specifying the level.

EchoStar chairman and founder Charlie Ergen suggested on the November earnings conference call that the valuation was around $400 billion, in line with a private sale of SpaceX stock reported by The Wall Street Journal in the summer.

The price that EchoStar received was $212 a share for SpaceX, which implies something close to two billion shares outstanding. SpaceX doesn’t disclose its share count.

Swinburne wrote that if the SpaceX valuation gets to $800 billion, his bull-case scenario for EchoStar would go up to $150 a share.

That scenario looks more likely given the potential for a trillion-dollar-plus IPO. At $1.5 trillion, the EchoStar net asset value could move considerably above $150 a share.

Bloomberg reported that a current SpaceX secondary offering to allow liquidity to employees and others values the company at around $420 a share, more than $800 billion.

That reported price of $420 would be about double the price involved with the EchoStar deal and would mark a coup for Ergen.

Swinburne wrote that every $100 per share gain in SpaceX stock equates to about $18 a share for EchoStar stock. Complicating calculations are taxes on any gains and any liquidity discount on EchoStar’s SpaceX holdings.

TD Cowen analyst Gregory Williams has a similar analysis involving higher SpaceX valuations for EchoStar.

With SpaceX gaining more momentum financially as its Starlink satellite internet service expands, Wall Street is getting more excited about an IPO. Bloomberg reported that SpaceX’s revenue in 2026 could total $22 billion to $24 billion, up from about $15 billion this year.

Write to Andrew Bary at andrew.bary@barrons.com