SpaceX: What Investors Need to Know About Its Enormous Upcoming IPO
Plus: The Market Is Missing the Bigger Picture on This Undervalued Stock, 10 Stocks the Best Fund Managers Have Been Selling; With Commodity Prices Booming, Few Mining Stocks Look Cheap
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Stock StrategistJune 1, 2026 In this issue:
There are few ways to escape the degree to which the artificial intelligence trade is dominating the market. More news on the historic level of spending on AI lifted four of last week’s five top-performing stocks on Morningstar’s US coverage list. The market is just weeks away from the largest IPO in history: SpaceX. Today, Morningstar initiated equity research of SpaceX ahead of the launch. Morningstar analyst Nicolas Owens and Morningstar director Suryansh Sharma examined the fundamentals of the company’s three main business lines, assessing the company’s value and whether SpaceX warrants a moat. You can find Morningstar’s take on whether SpaceX has been overvalued or fairly priced, along with other key takeaways for investors here. This follows on coverage from our colleagues at PitchBook, who looked at how the company is structuring its lockup period for pre-IPO shares to help smooth out trading after it goes public, as well as how a deleted section of its S-1 filing revealed how profitable renting out servers can be. It’s not just AI stocks that have been roaring. As Morningstar analyst Jon Mills notes, mining stocks have had a very good run and many are looking expensive. He highlights some of the few opportunities that remain. This week we have a number of updated stock screens to showcase. First up, the stocks with the 10 biggest fair value increases from Morningstar analysts in the wake of first quarter earnings, where datacenters and AI are a major theme. On the flip side, we have the five stocks with the largest valuation cuts. In addition, Susan Dziubinski is out with a new list of 10 stocks that the best fund managers have been buying, and 10 stocks that they’re unloading. Lastly, Morningstar equity analyst Seth Goldstein takes a close look at a wide-moat stock that he thinks is 15% undervalued. Investors seem to think that the company’s profits will be pinched by inflation. But he thinks that view is off base, and like this company’s products, long-term investors in the stock should be able to clean up. As Morningstar launches research coverage of SpaceX, we think the company has been significantly overvalued and investors will have opportunities to buy the stock at more attractive levels after the IPO. Nicolas Owens, Suryansh Sharma
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With huge demand expected at the IPO, SpaceX is hoping to smooth out the stock’s future. Corporate governance experts say the SpaceX IPO filing reveals a mix of weak investor protections and multiple conflicts of interest. SpaceX could recoup its AI infrastructure capex in under a month. This wide-moat stock is a buy as investors confuse noise with signal. The ‘anything-but-AI’ sentiment in the market is leaving many of these stocks looking attractive. These nine undervalued energy stocks look attractive today. American Airlines and Trade Desk are among the stocks with the deepest reductions. Tech companies Intel, Ciena, and Seagate saw the largest fair value hikes. Top investors have taken money off the table in these names. Here’s where top stock-pickers have been investing lately. Strong balance sheets support growth, but miner shares look very expensive overall. The portfolio case for investing in international stocks extends beyond their recent outperformance. With shares trading at a discount, here’s what we think of Home Depot stock. With increased traffic growth amidst macroeconomic pressures, here’s what we think of Walmart stock. Morningstar’s analyst unpacks Microsoft’s AI investments, revenue growth potential, and biggest risks while making the case for a $600 valuation. ResMed fell into 5-star territory. Marvell Technology and HCA Healthcare are among the stocks that fell into undervalued territory. We raise our fair value estimate for Spotify stock. The deal can make sense as the convenience economy consolidates. The Tools You Need to Invest Like an Analyst Stay connected:
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