Analysts at HSBC recently chipped in with their verdict on SpaceX (NASDAQ:SPCX) shares. And there’s quite a spread between the bank’s base price target and optimistic blue-sky scenario.

The former is just $115, which is basically where the stock’s at today, implying that no gains will be made. However, the bull case is $293, implying a whopping return of about 153%.

Could SpaceX more than double from here? This is my take.

The chopsticks are waiting

The blue-sky bull case rests on the continued worldwide adoption of Starlink’s satellite internet service and the successful commercialisation of Starship. The latter — the world’s largest rocket at about 408-feet tall — will accelerate the expansion of Starlink.

Last week, SpaceX investors got great news when Starship successfully completed its 13th test mission. Once in suborbital space, it released 20 Starlink V3 satellites. These are more powerful, supporting far greater bandwidth and much faster internet speeds.

Equally impressive, the upper stage reignited its engines to flip over and gently splash down in the Indian Ocean. It was Starship’s best re-entry yet.

The test wasn’t perfect, however, as some engines of the first-stage booster failed to ignite, resulting in a hard landing in the Gulf of Mexico. Nevertheless, this is huge progress for SpaceX, as it moves Starship closer to regular flights in future.

On the next mission (Flight 14), the firm will attempt to catch the upper stage with the ‘chopstick’ arms of the launch tower for the first time. Successful recovery of both the booster and upper stage would turbocharge turnaround and massively lower the cost of accessing space.

To summarise, here are three things a fully reusable Starship would unlock:

• A massive expansion and upgrade of Starlink.
• Landing humans on the Moon for NASA (planned for late 2028).
• The deployment of thousands of AI-dedicated satellites in orbit (potentially).

The moat is massive

This is why I’m so much more bullish on SpaceX long term than Tesla. There are rival Chinese firms building humanoid robots and self-driving taxis, but none are anywhere close to launching 40-storey rockets then catching them with mechanical ‘chopsticks’. 

Crucially, the barriers to entry here – technically, regulatory, financially – are simply enormous. Basically, SpaceX is in a league of its own today.

Reusability is key. The old model of single use rockets was akin to buying an expensive car to make a single journey. Reusable cars allow mass transportation on the ground; reusable rockets allow mass transportation in space…Reusability places [SpaceX] years ahead of competitors.  
Scottish Mortgage Investment Trust.

The valuation is Starship-esque

Looking ahead, Wall Street anticipates massive growth, with $39bn and $73bn of revenue pencilled in for 2026 and 2027, respectively. However, I worry about those figures in relation to the firm’s $1.5trn market cap.

We’re looking at forward sales multiples of 39 and 21. And HSBC doesn’t expect SpaceX to turn a profit until at least 2028 or generate positive free cash flow before 2030.

The sky-high valuation adds significant risk. If the company’s growth disappoints, even slightly, the stock could get crushed.

Should investors be interested in SpaceX? Absolutely, because it’s a unique growth company. But as far as the stock is concerned, I think it’s worth thinking about waiting for a more sane valuation.

Should you invest £5,000 in SpaceX right now?

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Ben McPoland owns shares in HSBC and Scottish Mortgage Investment Trust.