TSLA and SPCX: Why I Am Bullish on Tesla and SpaceX Stock

I am bullish on Tesla and SpaceX, but not because they share Elon Musk, not because rockets and robots look good in a highlight reel, and definitely not because either stock is cheap. I see two different infrastructure platforms attacking two different giant markets. Tesla is building vehicles, energy storage, autonomy, and physical AI on Earth. SpaceX is building launch, satellite connectivity, and computing infrastructure above it.

That distinction matters. A strong SpaceX launch does not fix a weak quarter at Tesla. A successful Tesla robotaxi rollout does not reduce SpaceX's Starship risk. The stocks can trade together when investors chase or reject the broader Musk story, but their revenue engines, capital needs, regulators, and execution tests are different.

There is also a major change investors need to know. SpaceX is no longer only a private-market story. The company completed its initial public offering at $135 per share, and SPCX began trading on June 12, 2026. That means ordinary brokerage investors can finally buy the stock directly. It also means SpaceX now has a daily price, public filings, quarterly expectations, lockup supply, and all the short-term noise that comes with public markets.

My view is bullish over three to five years. My entry discipline is much less enthusiastic. Tesla reports second-quarter results after the close on July 22, while SpaceX is trading below its IPO price but still carries one of the richest valuations in the market. Being bullish on both businesses does not require buying both stocks today at any price.

Tesla can become the operating system for electric mobility, distributed energy, and useful physical AI, while SpaceX can become the operating system for launch, global connectivity, and space-based infrastructure. Both companies already have real revenue engines that can fund those ambitions. The upside comes from turning expensive optionality into repeatable, profitable services.

Tesla's first-quarter numbers were stronger than the stale collapse narrative. Revenue reached $22.4 billion, up 16% from the prior year. Automotive revenue rose 16% to $16.2 billion, and automotive sales increased 20% to $15.5 billion. Total GAAP gross margin improved to 21.1% from 16.3%, while total automotive gross margin rose to 21.1% from 16.2%.

Operating income was still only $941 million, or a 4.2% operating margin. That is not enough profitability to justify the entire valuation by itself. But operating income more than doubled from the prior year, GAAP net income rose 17% to $477 million, and the gross-margin recovery shows that Tesla is not merely buying unit growth through endless price cuts.

The second quarter adds another useful data point. Tesla produced more than 450,000 vehicles and delivered more than 480,000. Strong deliveries do not automatically mean strong profits because mix, incentives, and regulatory credits matter. They do tell me the product engine has scale and that the next debate belongs in the income statement, not in a prediction that demand vanished.

Tesla Energy deserves more attention than it gets. First-quarter energy generation and storage revenue declined 12% to $2.4 billion because deployments were lower, yet the segment's gross margin improved to 39.5% from 28.8%. In the second quarter, Tesla reported 13.5 gigawatt-hours of energy storage deployments.

That combination matters. Electricity demand from data centers, manufacturing, electrification, and aging grids is rising. Batteries can shift power across hours, stabilize grids, and help customers use intermittent generation more effectively. Tesla's Megapack business is not a side hobby. It is a scaled product selling into a bottleneck that should persist for years.

The next test is whether the 13.5 gigawatt-hour deployment quarter produces durable revenue, margin, and cash flow. A volatile project schedule can make quarterly comparisons noisy. I want growth over multiple quarters, not a single record that disappears in the next report.

Tesla said it launched unsupervised Robotaxi rides in Dallas and Houston in April. That is a much more important milestone than another polished demonstration. A real service creates real evidence: paid miles, fleet utilization, safety interventions, insurance costs, geographic expansion, customer retention, and unit economics.

Investors also need to keep two products separate. FSD (Supervised) still requires an attentive driver and does not make a normal customer vehicle autonomous. Tesla's unsupervised Robotaxi service is a distinct operating deployment. Blurring those categories creates hype and makes serious analysis harder.

My bull case does not assume every Tesla already on the road suddenly becomes an autonomous taxi. It assumes that Tesla can use its manufacturing scale, onboard compute, software iteration, charging network, and fleet data to build an autonomous service faster and more cheaply than a company starting with no vehicle platform. The evidence has started arriving, but the safety and economics still have to be proven city by city.

Tesla has been preparing production lines for Cybercab, Tesla Semi, and Megapack 3, while reporting progress toward Optimus mass production. I do not put full science-fiction value on any of those programs. I do value the manufacturing system that can turn a successful design into volume production.

Cybercab could lower the cost of a purpose-built autonomous fleet. Semi could attack high-utilization commercial transport. Optimus could eventually address repetitive industrial labor inside Tesla factories before moving into external customers. Each can fail or arrive late. Together, they give Tesla more ways to compound if even one becomes a real business.

The right way to value optionality is with milestones, not slogans. For Cybercab, I want production volume and paid autonomous miles. For Semi, I want fleet customers, total cost of ownership, and factory throughput. For Optimus, I want deployed units performing useful tasks for sustained periods, not a stage appearance.

Tesla ended Q1 with $44.7 billion in cash, cash equivalents, and investments. It produced $3.9 billion of operating cash flow and $1.4 billion of free cash flow during the quarter. That balance sheet gives the company room to invest through an uneven product cycle without immediately depending on fragile financing markets.

Cash does not excuse poor capital allocation. Robotaxi fleets, new factories, AI training, Cybercab, Semi, and humanoid robots can consume enormous sums. The balance sheet is bullish only if those investments create future cash flows rather than a permanent collection of delayed promises.

SpaceX reported roughly 650 launches through the first quarter, including about 620 Falcon 9 flights and 11 Falcon Heavy flights. More than 95% of Falcon missions used previously flown vehicle hardware. Since 2023, SpaceX says it has delivered more than 80% of the world's mass to orbit.

That lead is not only about rockets. Reusability lowers launch cost, frequent missions improve operational learning, and vertical integration gives SpaceX more control over engines, vehicles, pads, satellites, software, and customer scheduling. Competitors can build capable rockets. Recreating the full cadence and operating system is a much harder assignment.

The weak point is visible in the Q1 numbers. Space segment revenue fell 28% to $619 million because the company completed fewer customer launches, while the segment recorded a $662 million operating loss amid higher Starship research and development. The launch moat is real, but the economics are currently being burdened by the next vehicle.

Connectivity is the clearest reason I am bullish on SpaceX. First-quarter connectivity revenue rose 32% to $3.3 billion, and operating income reached $1.2 billion. Starlink subscribers more than doubled to 10.3 million from 5.0 million. SpaceX had more than 9,600 satellites in orbit and offered service across 164 countries and markets.

That is an extraordinary installed network. Launch and satellite manufacturing are integrated inside the same company, so SpaceX can replenish and expand the constellation without paying an outside launch provider. The company controls the physical network, the customer relationship, the terminals, and the route to orbit.

The pressure point is pricing. Average revenue per user fell about 23% to $66 per month as SpaceX expanded internationally and used lower-priced plans. Subscriber growth more than offset that decline in Q1, but the long-term bull case requires either continued volume growth, new higher-value services, improving terminal economics, or some combination of all three.

Starship is not just a bigger Falcon. A fully reusable heavy-lift system could lower the cost of putting satellites, cargo, fuel, infrastructure, and eventually people into orbit. That can improve SpaceX's own Starlink economics while creating entirely new mission categories for governments and commercial customers.

I treat Starship as a high-value option with a brutal execution path. SpaceX had completed 12 Starship flight tests by the time of its IPO materials. Progress can be fast, but schedules can move, test vehicles can fail, and regulators can slow launch cadence. Investors should not value every future Mars or orbital-computing claim as if it were contracted revenue.

Starlink began with fixed broadband, but the network can support maritime, aviation, enterprise, government, direct-to-device, and other mobility services. Those customers can have different economics from a household subscription. A connected ship, aircraft, emergency network, or defense user may pay for reliability and coverage that terrestrial alternatives cannot provide.

The strategic combination is powerful: launch creates and refreshes the network; the network generates recurring revenue; recurring revenue funds launch, satellites, and new infrastructure. That flywheel is more defensible than a launch provider waiting for customers to fill its manifest.

SpaceX's public company now includes the AI operations associated with xAI and X. The IPO factsheet cited roughly 550 million monthly active users across Grok and X and more than one gigawatt of nameplate compute draw. That creates possible distribution and infrastructure advantages, but the financial burden is currently severe.

The AI segment produced $818 million of Q1 revenue, up 13%, while operating loss widened to $2.5 billion. Research and development expense increased 162% to $2.4 billion. That loss is too large to wave away. The segment must eventually prove it can monetize models, subscriptions, enterprise services, advertising, or infrastructure at a level that justifies the compute bill.

I view AI as upside, not the foundation of my SpaceX thesis. Starlink and launch have to support the valuation on their own operating evidence. If AI becomes a profitable third engine, excellent. If it remains an accelerating cash drain, it can damage an otherwise exceptional space and connectivity business.

SpaceX sold IPO shares at $135 and closed its first trading day near $161. By July 20, SPCX was trading around $123, below the offer price and roughly one-quarter below that first close. A falling price does not automatically create a bargain.

At around $123, the equity value was roughly $1.6 trillion. Compared with 2025 revenue of $18.7 billion, that is a rough price-to-sales ratio near 87 times. This is a simplified calculation, not an official valuation metric, but it captures the problem: the market is already charging investors for years of exceptional execution.

The stock also faces a near-term supply risk. Lockup restrictions can expire after the first public earnings cycle, potentially making far more shares available for sale. The exact Q2 reporting date had not been formally confirmed when I published this, so I will not invent one. I will watch the official investor calendar and the share-supply terms instead of relying on social-media countdowns.

Tesla's Q2 report is the immediate event. The company-compiled analyst consensus calls for average revenue of about $27.6 billion, including roughly $20.0 billion of automotive revenue and $3.8 billion of energy revenue. Tesla explicitly says it does not endorse those estimates.

The headline beat or miss will matter less to me than the quality of the quarter. I want to see whether automotive margins held after more than 480,000 deliveries, whether 13.5 gigawatt-hours of storage translated into strong energy economics, and whether free cash flow supports the growing capital plan.

A bullish thesis needs an exit door. Tesla's valuation leaves little room for several years of ordinary auto-company economics. If autonomy remains limited, energy stops scaling, and new products keep moving right, the stock can rerate long before the business fails.

SpaceX has a wider moat and a more extreme valuation. The stock does not need the company to become bad in order to fall. It only needs growth, margins, or timelines to look normal against expectations priced for near perfection.

I would not treat this as a package trade where every dollar has to be split equally. Tesla has more public-market history, an imminent earnings catalyst, and several measurable operating businesses. SpaceX has the deeper launch moat and faster connectivity growth, but its valuation and first-year public-company risks are more severe.

For Tesla, I would rather evaluate the July 22 report and the market's response than gamble on a short-term earnings reaction. For SpaceX, I would size more cautiously, wait for the first quarterly disclosure, and watch how the stock absorbs lockup-related supply. A high-conviction business can still require a small position because valuation risk is position risk.

For options, I would keep risk defined. Both names can move violently around earnings, launch events, regulation, and Musk headlines. The right long-term opinion can still lose money through oversized exposure, short expiration, or an entry made when implied volatility is extreme.

I am bullish on Tesla because the auto business is recovering, energy is becoming a serious profit engine, and robotaxi has moved from demonstration to operating evidence. Cybercab, Semi, and Optimus add upside, but the thesis still has to show up in margins, utilization, and free cash flow.

I am bullish on SpaceX because reusable launch and Starlink form one of the most defensible infrastructure flywheels in the market. The company has doubled subscribers, built a profitable connectivity segment, and created a launch cadence competitors have not matched. Starship can expand that lead, but AI losses and an extraordinary valuation cannot be ignored.

These are not cheap stocks and they are not blind faith bets. They are high-expectation platforms with real operating advantages and clear failure conditions. I want exposure when price, evidence, and risk control line up. I do not need to chase either one to prove I believe in the future they are building.

Tesla Q1 2026 Form 10-Q

Tesla Q1 2026 update

Tesla Q2 2026 production and deliveries

Tesla Q2 2026 earnings consensus

SpaceX final IPO terms

SpaceX IPO prospectus

SpaceX IPO factsheet

SPCX market data

SpaceX post-IPO lockup analysis

Disclaimer: MentorSurge is not a financial advisor and this is not financial advice. This article is educational market commentary, not a recommendation to buy, sell, or hold Tesla, SpaceX, or any other security. Prices, estimates, and business conditions can change quickly. Do your own research and consult a licensed professional before risking real money.