[Weekend Money] SpaceX Opens the Space Age: Where Is the Next Opportunity?

SpaceX is driving explosive growth in the global space industry by cutting launch costs and proving the economic viability of its services. As demand for satellite launches rises sharply worldwide, analysts say companies should look for spillover opportunities in areas with greater demand for Earth observation and defense than for communications, and greater reliance on external procurement.

In a recent report, Park Kwangnam, an analyst at Korea Investment & Securities, said, "We maintain our overweight rating on the space industry and name SpaceX, which is leading market expansion, as our top pick. Investors should focus on companies securing actual customers and orders in the market SpaceX has expanded."

Cost reductions enabled by reusable launch vehicle technology, the establishment of mass-production systems, and proof of Starlink's commercial viability are spurring satellite investment by governments and competitors.

According to the report, global satellite launch demand, excluding orbital data center satellites from China and SpaceX, is expected to rise about 2.6-fold, from 4,123 satellites in 2026 to 10,757 in 2030. SpaceX's own satellites will account for 54% of the increase, but launch demand from the Western bloc excluding SpaceX is also estimated to grow 4.3-fold over the same period, from 913 to 3,957 satellites. Demand is also highly visible for large satellite constellations, as launch schedules are set to meet regulatory deployment deadlines.

However, rising satellite demand will not necessarily translate directly into improved performance for all space component suppliers. SpaceX has brought most key components in-house, while Amazon and Blue Origin, which account for 90.5% of satellite constellation plans outside SpaceX, also manufacture their own satellites.

Prospects vary by sector. Starlink and SpaceX effectively dominate communications and orbital computing, backed by unmatched launch costs. By contrast, competition in Earth observation satellites is limited because SpaceX does not operate a commercial imaging business, and the sector is growing rapidly as demand for sovereignty and defense capabilities expands among governments.

In the defense sector, even if SpaceX handles 55% to 77% of U.S. military satellite volume from 2026 to 2035, its share of hardware value will be only 19% to 28%. Hardware for high-value specialized satellites, including reconnaissance and early-warning systems, will go to established defense primes and companies specializing in precision sensors and propulsion systems.

Park said, "Opportunities for external suppliers lie in manufacturing satellite constellations outside SpaceX and Amazon, supplying bottleneck components that are in short supply, and launching satellites for defense and independent constellations."

Korea Investment & Securities raised its target price for SpaceX to $234. SpaceX posted third-quarter revenue of $14.58 billion, up 161% from a year earlier, and adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) of $8.81 billion, for a 60.4% margin. This demonstrated the company's growth potential, with computing investments translating into revenue in just one quarter. However, the report cited the large lock-up expirations scheduled for December 8, 2026, and June 2027 as short-term supply-and-demand factors to watch.

The firm also initiated coverage of five companies: Rocket Lab (defense satellite prime and alternative launch provider), MDA Space (non-SpaceX and sovereign satellite manufacturing), Filtronic (Starlink ground-station radio frequency equipment), Planet Labs (Earth observation data), and AST SpaceMobile (a direct-to-device alternative for telecom operators).

Park added, "The extent to which Rocket Lab, MDA Space, and Planet Labs benefit will depend on how quickly external launch vehicle supply is confirmed. Investors should be mindful of the possibility of downward revisions to long-term growth expectations and focus on companies that have secured actual order backlogs."

This content was produced with the assistance of AI translation services.