Tesla (TSLA) stock closed around $402.90 on Tuesday, down over 4%, as Wall Street began wrestling with a new question: what happens if Tesla and SpaceX become one company?
The conversation picked up after SpaceX completed a record $75 billion IPO at a $1.77 trillion valuation. That event put Elon Musk’s empire front and center, and investors started asking whether his two biggest companies could eventually be folded into a single platform covering AI, robotics, energy, transport, and space.
RBC Capital analyst Tom Narayan moved first. He raised his price target on TSLA from $475 to $500 and kept a Buy rating. He said media chatter about a Tesla-SpaceX merger had investors asking what a combined company might look like.
Narayan laid out the numbers clearly. The most likely deal structure, in his view, would be an all-stock transaction with SpaceX acquiring Tesla at a 20–30% premium. That premium is where the $500 figure comes from.
He also noted Tesla investors would likely demand that premium, since Elon Musk would end up controlling more than half of the merged entity — well above his current 20% stake in Tesla.
Without any deal, Narayan values Tesla at around $435 on a standalone basis, roughly 10% above where it was trading.
Narayan’s note also reshuffled valuations across Tesla’s business units. He bumped his robotaxi estimate up 20% based on a higher global fleet forecast, calling it Tesla’s strongest long-term opportunity against a $4.2 trillion addressable market.
The humanoid business took a hit. Narayan cut that segment by around 40% after lowering his U.S. market share assumption from 50% to 20%. It still makes up roughly 25% of his total valuation.
Energy storage also saw a 30% cut, driven by a softer market outlook and rising competition squeezing margins — even as AI data center demand continues to grow.
JPMorgan analyst Rajat Gupta acknowledged the merger thesis has logic, describing a combination as “strategically coherent on paper.” Tesla brings EVs, batteries, autonomy software, and robotics. SpaceX brings launch systems, Starlink, satellite infrastructure, and defense-linked capabilities.
Together, the combined entity looks less like two separate companies and more like a single industrial tech platform.
But Gupta wasn’t ready to call it a buy signal. He flagged substantial regulatory and jurisdictional hurdles, with China standing out as the key complication. Tesla has major manufacturing and sales exposure there. SpaceX, meanwhile, operates in sensitive satellite and defense-linked areas that could make approvals politically difficult in Beijing.
Gupta kept a Hold rating on Tesla.
The broader Wall Street consensus backs that caution. Out of analysts who have rated TSLA in the last three months, 10 say Buy, 15 say Hold, and three say Sell. The average price target sits at $399.71 — implying slight downside from current levels.
TSLA was red in pre-market trading Wednesday.
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