Last updated: July 26, 2026 · By Vishal Swami, Founder & Lead AI Reviewer, AISagely
SpaceX at $100 would imply zero AI value because Morgan Stanley analyst Adam Jonas says the stock's slide has erased the market's entire premium for the company's AI segment, Grok and Cursor, while leaving its rocket and Starlink business roughly unchanged. Jonas keeps a $300 price target on SpaceX and attributes more than half of that number to AI, which turns the gap between today's price and $100 into a debate about what Grok and Cursor are actually worth.
Short answer: Morgan Stanley's Adam Jonas says a drop to $100 would price SpaceX's AI business, Grok and the pending Cursor deal, at zero or less, against his $300 target where AI is over half the value. In my testing of both products, zero undersells them; unproven at this valuation is closer to the truth.
I review AI tools for a living, and two of the three names in this SpaceX AI debate, Grok and Cursor, are products I've actually used inside real workflows, not just charted on a spreadsheet. So when a Wall Street note says the market is assigning them zero value, my first move isn't to check the ticker; it's to check whether the products hold up to that verdict. Mostly they do, with real caveats, and that's the more useful story than the stock price alone.
What Morgan Stanley Actually Said
SpaceX priced its IPO at $135 a share on June 12, 2026, raising a record $86 billion, the largest public offering by a private company to date. The stock spiked almost 50% to roughly $225 over the next three trading sessions, then gave nearly all of that gain back. It closed at $114.87 on Friday, July 24, 2026, after touching an intraday low of $110.85 earlier that week, according to Bloomberg’s report on Morgan Stanley’s note.
Jonas's math works like this: he keeps a $300 price target on SpaceX, and more than half of that figure comes from the AI business rather than rockets or Starlink. Run that backward and a $100 share price implies the market is pricing AI at zero or negative, a discount he called out directly, writing that "most investors we speak with significantly discount Grok & Cursor." He still described the sell-off as "a disconnect between increasingly bearish investor sentiment and largely unchanged fundamentals" and kept his buy rating in place.
There's a concrete near-term catalyst behind the pessimism, too. SpaceX's IPO lockup expires on August 6, 2026, four days after its first quarterly earnings report as a public company on August 4. Roughly 911.5 million shares, about 20% of the locked-up stock, become eligible for sale right as investors get their first real look at the numbers, per BigGo Finance’s coverage of the note.
What SpaceX's "AI Business" Actually Is
The AI segment Jonas is valuing isn't hypothetical, and it isn't rockets with a chatbot bolted on. It's three concrete pieces: Grok, folded into SpaceX after xAI's merger in February 2026; Cursor, the AI coding tool SpaceX is acquiring for $60 billion in a deal expected to close in Q3 2026; and a data center and power plant build-out in the greater Memphis area to run both.
That distinction matters, because it changes the question the note is really asking. "Zero value for SpaceX's AI business" doesn't mean zero value for space and satellites, it means the market currently isn't paying anything extra for a chatbot with a huge built-in user base and one of the two AI coding tools serious engineering teams actually pay for.
I've Tested Grok and Cursor. Does "Zero Value" Hold Up?
Cursor is the easier one to check, because its business model sits in daylight. The free Hobby tier gets limited agent requests; the Individual plan runs $20 a month for extended agent limits and access to frontier models, including "generous limits for Grok," per Cursor’s own pricing page; Teams is $40 per user per month with centralized billing and admin controls; and Enterprise is custom-priced for pooled usage and compliance features. In my testing, Cursor's agent mode is the fastest way I've found to turn a large, messy codebase into a reviewable diff, quicker than asking ChatGPT or Claude to do the same thing from a plain chat window, because the editor's own context does work a prompt would otherwise have to spell out.
Grok is harder to grade on product quality alone, because its value to SpaceX isn't really "is the chatbot good," it's distribution. It ships inside X to a user base most standalone AI chatbots would need years of marketing spend to reach, and it now shows up as a model option inside Cursor's own pricing tiers, which is a checkable integration rather than a press-release promise. When I tested it head to head against ChatGPT and Claude on coding and search-grounded questions, Grok held up on speed and access to current information, and lagged on the kind of careful, multi-step reasoning I'd trust for a high-stakes decision, closer to "useful and developing" than "zero" or "settled."
So "zero value" is a market-pricing statement, not a product review. A market can price something at zero because it doubts the revenue will show up on schedule, even when the product itself works, and that's a fair thing to be skeptical about given how new the Cursor deal and the Memphis build-out both are.
SpaceX Price Scenarios and What They Imply for AI Value
| SpaceX share price | Implied view on the AI segment | Who's saying it |
|---|---|---|
| $300 | AI (Grok + Cursor) worth more than half of SpaceX's total value | Adam Jonas's Morgan Stanley price target |
| ~$232 | Some AI premium priced in, but less than Jonas's estimate | Street-wide average analyst price target |
| $114.87 (July 24 close) | AI heavily discounted; rockets and Starlink still valued normally | Current market price |
| $100 | AI segment priced at zero or negative | The threshold Jonas flagged as the tipping point |
Common Mistakes Readers Make With This Kind of Note
The first mistake is reading "zero AI value" as "SpaceX is worthless below $100." It isn't. Jonas's own math says rockets and Starlink alone hold up the rest of that price; the AI piece is the marginal, most-debated slice, not the whole company.
The second is treating one analyst's price target as a fact instead of a model. A $300 target with more than half attributed to AI is Jonas's estimate of Grok and Cursor's future cash flows, discounted back to today. Plenty of the roughly 80% of analysts who still rate the stock a buy land on a lower number for the same reasons the shares sold off in the first place.
The third is ignoring the calendar. The lockup expiration on August 6 and the earnings report two days earlier aren't abstract dates, they're the specific events that could push the stock toward $100 regardless of whether Grok or Cursor actually improve in the meantime. Mechanical selling pressure and product quality are two different variables, and this note is mostly about the first one.
Tools That Make It Easier to Judge AI Value Yourself
You don't need a trading terminal to sanity-check a note like this, you need direct time with the products being valued. My AI tool ratings page and AI tool reviews hub score chatbots and coding assistants against the same criteria, so you can see where Grok and Cursor land next to their direct competitors rather than taking one analyst's word for it. If Cursor specifically is what you're weighing, my guides to ChatGPT alternatives for coding and the best AI tool for code put it side by side with the other editors and assistants serious teams pay for. For the broader pattern of AI valuations running ahead of, or behind, what the tools can currently do, my pieces on corporate America’s pullback in AI spending and on how AI mania distorts decision-making cover the same disconnect from the enterprise-budget side. And if you want to try Grok or a comparable model against your own use case before forming an opinion, my free AI tools roundup covers where you can do that without paying for a subscription first.
My Take
Jonas isn't wrong that the market is currently paying nothing extra for Grok and Cursor at these prices, that's just what a falling stock with an unresolved AI story looks like. Where I'd push back a little is on how binary "zero" sounds. In my testing, both products do real, billable work today; what's actually unpriced is whether the multi-billion-dollar Cursor deal closes on schedule and whether the Memphis build-out turns into margin, not the current usefulness of either product. That's a bet on execution and timing, and the August catalysts above are exactly where it gets tested first.
Frequently Asked Questions
Does Morgan Stanley think SpaceX stock is a buy?
Yes. Adam Jonas rates SpaceX a buy with a $300 price target, more than half of which he attributes to the AI segment (Grok and Cursor), and he called the recent sell-off a disconnect between sentiment and fundamentals rather than a sign the business itself has deteriorated.
What exactly is SpaceX's "AI business"?
It's Grok, brought in through SpaceX's merger with xAI in February 2026; Cursor, the AI coding tool SpaceX is acquiring for $60 billion in a deal expected to close in Q3 2026; and a data center and power plant build-out in the greater Memphis area supporting both.
Why would the stock fall to $100?
Two dates are doing the work: SpaceX's first earnings report as a public company on August 4, 2026, and its IPO lockup expiration on August 6, 2026, when roughly 911.5 million shares, about 20% of the locked-up stock, become eligible for sale.
Is Cursor actually worth billions of dollars?
On its own, Cursor's paid tiers run from free (Hobby) to $20 a month (Individual) to $40 per seat (Teams), with custom Enterprise pricing, real recurring revenue, but the $60 billion price tag is a bet on that revenue scaling far past where it sits today, not a reflection of current subscription income alone.
Should I change how I use Grok or Cursor because of this note?
No, this is a valuation debate about SpaceX stock, not a product recall. In my testing, neither tool changed in capability the week this note came out; if you already rely on either one, keep evaluating them on output quality, not on where Morgan Stanley draws its price target.