The Cursor acquisition changes everything: Oppenheimer now expects SpaceX shares to rise by 30%

SpaceX shares could rise 30% following the strategic acquisition of Cursor—the developer of a popular AI programming tool—according to Oppenheimer. A week ago, the investment bank initiated coverage of the space company’s stock with a price target of $190; it has now raised that target by 32%, according to CNBC. Meanwhile, SpaceX shares plummeted 9% during Thursday’s trading session.

Oppenheimer analyst Timothy Horan raised his price target for shares of Elon Musk’s space company from $190 to $250, maintaining an “Outperform” rating, which is equivalent to a buy recommendation. This is 30% higher than Wednesday’s closing price. Horan set the $190 target on Friday, the day the space company went public on the Nasdaq. The stock reached that level on its second day of trading.

Khoran explained that he revised his valuation five days after SpaceX’s IPO, following the company’s June 16 announcement of its acquisition of Cursor—the developer of a popular AI programming tool that allows users to automatically generate, edit, and verify computer code. The deal is valued at $60 billion in SpaceX stock.

“This deal is very beneficial for both parties,” CNBC quotes Horan as saying. “Cursor gains the computing power it needs to train and work with its models, while SpaceX, in return, gains an engineering environment, data, and its own pool of experienced developers. This closes the loop on its AI ecosystem and strengthens vertical integration, which drives innovation and margins.”

The analyst believes that the acquisition of Cursor will provide SpaceX with several assets at once and increase its revenue and profits. SpaceX is acquiring a suite of agent-based programming tools, including an operational software layer that supports the autonomy and reliability of large language models, as well as a database with over 1 million users. “Such a channel for reaching developers and this volume of data are difficult to replicate, and SpaceX needs them to gain a share of the AI market,” Horan explained.

According to Oppenheimer’s estimates, Cursor’s annual recurring revenue is currently on track to reach $4 billion, up from $1 billion in 2025, and could grow to $6 billion by the end of 2026. Consequently, Horan raised his forecast for SpaceX’s AI revenue in the fourth quarter to $8.75 billion from the previous estimate of $4.75 billion.

During Thursday’s trading session, shares of Elon Musk’s space company plummeted 9.2% to $174.2. This marks the second consecutive day of declines for SpaceX shares. The shares were priced at $135, and trading on Friday, April 12, opened at $150. Thus, on the fifth day of trading, the company’s stock remains up 16%. SpaceX shares reached their intraday high on June 16, when they rose above $220.

— “The acquisition of Cursor results in significantly less dilution of SpaceX shareholders’ stakes due to its high valuation,” investor Bill Eckman wrote on X. — “And SpaceX’s ability to make acquisitions that strengthen the company economically, strategically, and technologically is an important component of its value.”

— On June 16, the research and consulting firm Zephirin Group began tracking SpaceX shares, anticipating that they could rise to $310 due to high demand, according to Barron’s. Currently, only about 640 million shares are in free float, which is insufficient for the more than 300 index funds seeking exposure to SpaceX, Zephirin noted.

— On June 12, analysts at Wolfe Research initiated coverage of SpaceX shares with an “Outperform” rating and a price target of $175. They are betting on the company’s rocket launches and its expanding Starlink satellite network, according to MarketWatch.

According to MarketWatch, a total of six analysts are covering SpaceX stock. Four recommend buying the stock, and two recommend selling it. The Wall Street consensus price is $213.4, which is 11% higher than the closing price on June 17.

This article was AI-translated and verified by a human editor