SpaceX Is Becoming a “Neocloud.” Here’s the Beaten-Down AI Stock 75% Off Its Highs That Could Benefit the Most.
On Monday, a Wall Street analyst wrote favorably about certain semiconductor stocks with a vendor relationship to Elon Musk’s Space Exploration Technologies (NASDAQ: SPCX), or SpaceX
While several companies in SpaceX’s supply chain were mentioned as beneficiaries, most of the mentioned stocks are at or near their all-time highs. However, one AI infrastructure stock should also benefit, perhaps even more than the others, and it’s the only stock in the group trading at a reasonable valuation, 75% below its all-time high. Why SpaceX vendors are poised to benefit On Monday, GF Securities analysts Jeff Pu and Alicia Xia wrote a note saying that, as SpaceX has begun renting out excess computing power to other AI companies, and given that it just raised a whopping $86 billion in last week’s initial public offering, there shouldn’t be any obstacle to SpaceX building a massive amount of computing infrastructure.
The theory is that this will benefit AI hardware makers that already have a strong relationship with SpaceX. SpaceX’s recent acquisition of Cursor should help improve both SpaceX’s Grok models and Cursor’s internal models, boosting demand for SpaceX’s internal AI computing needs. But even if that doesn’t work out, SpaceX’s recent decision to rent out its capacity to other rival AI companies and hyperscalers should be a promising “fallback” option.