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Morgan Stanley Clients Believe Big-Time in Musk's SpaceX

The bank's investor and industry-expert clients believe SpaceX could ultimately be worth more than Elon Musk's Tesla.
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Morgan Stanley clients apparently believe big-time in Elon Musk’s SpaceX company.

“The majority of our [investor and industry expert] clients (by survey and client discussions) believe SpaceX could ultimately command a higher valuation and significance than even Tesla,” Morgan Stanley analyst Adam Jonas wrote in a commentary cited by CNBC.

The space company has a ways to go to catch up with Musk’s electric car titan. Tesla closed trading Wednesday with a market capitalization of $858 billion. Meanwhile, SpaceX was valued at $100 billion in a secondary share sale reported by CNBC earlier this month.

“From our investor conversations, the sentiment on SpaceX has increased substantially along with the company’s valuation in the private market,” Jonas said.

Morgan Stanley asked clients, which of the two companies do you think is a more attractive investment from here and which do you think has the potential to be a more valuable company over the long term?

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The bank received 32 responses, and 63% chose SpaceX for both questions.

As for Tesla stock, it closed Wednesday at $865.80, up 0.18%. The shares have climbed 19% year to date amid investor enthusiasm for electric cars.

After the close of trading Wednesday, Tesla reported revenue of $13.757 billion for the third quarter, up 57% from $8.771 billion last year.

Net income attributable to shareholders soared to $1.618 billion, or $1.44 a share, in the latest quarter, up from $331 million, or 27 cents a share, a year ago.

“We achieved our best-ever net income, operating profit and gross profit,” Tesla said.