SpaceX Stock is Rebounding: Top 3 Reasons it Has More Upside to Go

SpaceX stock price has staged a strong comeback in the past few days. It moved from the all-time low of $104.8 to $136 in the premarket session today. This rebound has helped supercharge Elon Musk’s net worth, which soared by nearly $100 billion to $817 billion.

The stock remains significantly lower than the all-time high. However, there are reasons why it may resume rising in the near future.

SpaceX Stock May Jump as Revenue Growth Continues

One reason why the SPCX stock has more upside in the long term is that its business is thriving. Also, analysts expect the growth trajectory to continue.

The most recent earnings results showed that its business continues to grow. Its revenue jumped by 92% in the second quarter to $7.8 billion.

Most of this growth came from its connectivity business, which is made up of Starlink. This business made $4.2 billion in revenue as the number of connected customers soared.

Most notably, its AI business, which is made up of the xAI products, jumped from $818 million to $2.56 billion.

SpaceX has more room to grow, with the current quarter’s revenue soaring to $13 billion. For the year, analysts expect the figure will soar to $44.2 billion, much higher than the $18.5 billion it made last year.

The revenue is expected to jump to $90.2 billion next year. The chances are that its real revenue will be higher than these estimates.

SpaceX is Becoming a Big Data Center Company

The other catalyst for the SpaceX stock is that it is becoming a big player in the data center industry. There, it is leasing its extra space to other companies. In the future, the management believes that deploying data centers in space will be its main competitive advantage.

SpaceX has already inked major deals in the data center industry. For example, it reached a multi-billion-dollar deal with Anthropic, which is now paying it $1.2 billion a month. Google is paying it $950 million a month, while Reflection AI is paying it $150 million.

These partnerships will likely open more opportunities for the company in the future. For one, a company like CoreWeave has already inked deals worth over $99 billion. Other companies like Nebius, IREN, and TeraWulf have also reached more deals.

In addition, the company has more room to grow across the board. For example, Starlink has more room to grow as demand for broadband rises.

Technical Analysis Suggests That SPCX Stock May Rebound

Meanwhile, technicals suggest that the SpaceX stock may rebound further in the near term. It has already moved above the important resistance level of $133, the 23.6% Fibonacci retracement level.

The stock also formed a double-bottom pattern at $104. This pattern normally leads to more gains over time. It means that shorts are usually afraid of making bets below it.

SpaceX stock has already moved slightly above the 50-period Exponential Moving Average (EMA), a sign that bulls have prevailed. Furthermore, the Relative Strength Index (RSI) has jumped to 70, a sign that the momentum is strengthening.

Therefore, there is a likelihood that the stock will continue rising as investors continue buying the dip. If this happens, the next key level to watch will be at $165, the 50% Fibonacci retracement level, which is about 20% above the current level.

Still, some potential risks may hurt its performance. The most notable one is the rumored merger with Tesla, a company that makes vehicles.

Such a merger would not have any significant synergies for the company. Moreover, there are signs that the company is highly overvalued, with its forward PE.