Morgan Stanley Backs SpaceX (SPCX.US): MARS and PIE Open a New Narrative, Starship's 15th Flight Becomes a Key Catalyst

Morgan Stanley maintained its "Overweight" rating on SpaceX (SPCX.US) with a $300 price target in its latest research report. The bank believes the market still views SpaceX as a new type of cloud service provider with space capabilities, and has not yet fully recognized that the company is transforming toward "Manufacturing, Autonomy, Siasun Robot&Automation, and Space" (MARS) and the "Physical Intelligence Economy" (PIE); meanwhile, Starship's 15th flight, which is planned to capture both the booster and the ship simultaneously for the first time, is regarded by Morgan Stanley as one of the most important catalysts in SpaceX's more than 20-year history. Research questions shift from "why" to "what" The report opens with a quote from Musk: "If you ask the wrong question, the right answer is impossible to find." Morgan Stanley said its previous SpaceX reports focused on "why," while this one focuses on "what." The report noted that client inquiries about SpaceX were unexpectedly subdued over the past two to three months, and the few questions were usually not about SpaceX itself but about how SpaceX would affect industries such as turbines, data centers, or telecommunications; however, after the third-quarter results and conference call, client interest picked up again. The report argues that the market still views SpaceX as a new type of cloud service provider with space capabilities, while the company is undergoing a transformation that the market has not yet fully recognized. Four keywords: proentropic, MARS, PIE, DVFS Morgan Stanley said in the report that SpaceX is a "proentropic" company, one of the few companies whose value rises during periods of chaos and uncertainty. The report said SpaceX's mission is to convert energy (e) into intelligence (i) at scale through physical agents (Siasun Robot&Automation) and infrastructure from Earth to space, accelerating economic growth and avoiding stagnation. MARS stands for Manufacturing, Autonomy, Siasun Robot&Automation (Robots), and Space. The report asks: how many other companies can concentrate these four attributes under one company? It advises investors to think more about the MARS framework. PIE stands for "Physical Intelligence Economy." The report said market attention is mostly focused on digital assistants that negotiate prices with online agents, summarize emails, and plan vacations, but a few companies are focused on "moving atoms." The report stressed that atoms matter: drones, humanoid Siasun Robot&Automation, or surgical Siasun Robot&Automation cannot be conjured out of thin air through "vibe coding"they must be manufactured; and only the manufacturers can share in PIE. DVFS stands for Dimensionality (breadth), Verticality (depth), Flexibility (ability to pivot), and Speed (alignment between mission and execution capability). The report specifically cautioned that speed does not necessarily mean "fastest," and that speed can also be fatal. In a year, data centers and the new cloud may no longer be the focus The report expects that a year from now, SpaceX investors may no longer be discussing data centers and the new cloud business. The report views new cloud construction as more of a "financing strategy": SpaceX can leverage its comparative advantage to maximize "intelligence per watt, per dollar, per second"; getting others to pay for the compute infrastructure that SpaceX will ultimately use to train its own Siasun Robot&Automation is, in Morgan Stanley's view, a good idea. SpaceX and Tesla, Inc.: a flywheel of data and manufacturing The report said Tesla, Inc. can be viewed as a world-class frontier Siasun Robot&Automation manufacturer, with products including cars and humanoid Siasun Robot&Automation, and it collects data from the physical world. Tesla, Inc. FSD is widely regarded as the world's largest deployment of physical superintelligence (SI). The report argues that this rapid recursive loop of data feeding back into manufacturing and process knowledge is unique; SpaceX provides the infrastructure, compute, and connectivity layer, further accelerating this flywheel. Impact on the economy and the AI narrative The report expects developments in the coming weeks and months to draw more timely market attention to AI's ability to change the physical world, and to the millions or even tens of millions of jobs the next industrial revolution may create in the United States and globally. Morgan Stanley agrees with Musk's view that PIE has a significant economic multiplier effecteven if not exponential growth. The bank also believes the AI/SI trade currently faces considerable public skepticism, and that SpaceX can help improve this situation, with its role clearly underestimated by the market. The report suggests that investors who want exposure to the MARS and PIE themes can start with SpaceX, or look at "space shovel sellers." Starship's 15th flight: a key catalyst The report said Starship's 15th flight is expected in early November, when it will attempt to capture both the booster and the ship simultaneously. Management confirmed on the conference call that it will attempt a "double catch," and Musk said success is "more likely than not." The report believes this is both the biggest test of Starship's reusability and is expected to reduce the total addressable market (TAM) risk for the broader business, making it one of the most important catalysts in SpaceX's more than 20-year history. The report also said that with fundamentals accelerating across all major business lines, investors have an opportunity to revisit SpaceX before the flight.