SpaceX (NASDAQ:SPCX) shares extended their sharp recovery on Wednesday, August 12, climbing 9.65% to close at $146.15, their highest level since July 9. The stock has now rebounded 39% from its record low of $105.11 reached on August 6, with investor sentiment improving following comments from Elon Musk about the growing importance of artificial intelligence to the company’s revenue outlook.
Musk points to AI as a major revenue driver
The latest rally followed the release of a recording from an internal company meeting in which Musk reportedly told employees that revenue connected to artificial intelligence could exceed all of SpaceX’s other revenue sources as early as September.
Musk described AI as “extremely important” to the company’s future, strengthening expectations that artificial intelligence-related activities could become an increasingly significant part of SpaceX’s growth strategy.
The comments provided fresh momentum for the shares following a difficult period since the company’s stock market debut in June.
SpaceX absorbs lock-up expiration
The rebound also comes after SpaceX navigated the expiration of its first post-IPO lock-up period on August 6 without the level of selling pressure some investors had feared.
The expiration made approximately 911.5 million shares held by employees and company executives eligible for sale, potentially creating a substantial increase in available stock.
SpaceX shares reached their all-time low of $105.11 on the same day, but have since recovered rapidly, suggesting the market absorbed the additional supply more effectively than initially feared.
Despite the recent rally, the stock remains approximately 41% below its record high of around $226, reached in mid-June shortly after the company went public.
Analysts see further upside for SpaceX shares
Wall Street analysts remain positive on the company’s longer-term prospects despite the volatility since its listing.
The stock carries an overall buy recommendation, with an average analyst price target of $231.40. Compared with Wednesday’s closing price of $146.15, that implies potential upside of approximately 58.33%.
The gap between the current share price and analysts’ targets suggests expectations remain strong for SpaceX’s longer-term growth, particularly if AI-related revenue develops as quickly as Musk indicated.
Volatility remains a risk after rapid rebound
The speed of the latest recovery could nevertheless leave SpaceX vulnerable to short-term profit-taking.
A 39% increase in less than a week represents a substantial move, particularly for a recently listed stock that has already demonstrated significant volatility since its June debut.
The shares also remain well below their June peak despite the latest rebound, highlighting the wide trading range investors have experienced during the company’s first months as a publicly traded business.
Musk’s comments about AI have provided a new catalyst for the stock, while the relatively smooth absorption of the lock-up expiration has reduced one immediate source of selling pressure. However, following such a rapid advance, investors are likely to remain focused on whether the company’s AI-related revenue growth can support the renewed optimism reflected in the share price.