Analyst: Difficulty of Tesla-SpaceX Merger Is Underestimated
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Several Wall Street analysts warn that the market is far too optimistic on a Tesla–SpaceX merger — board fiduciary duties and multi-country regulatory approvals are two hard hurdles not yet priced in.
Why is "Musk calls the shots" a misconception?
Gary Black, co-founder of Future Fund Active ETF, notes that Musk controls over 80% of SpaceX voting rights — but that does not override the board's fiduciary duty to all shareholders.
This means → SpaceX's board must prove the deal benefits every shareholder, not just Musk's personal asset consolidation.
In plain terms = no matter how large the voting stake, the board cannot spend all shareholders' money on a deal that only works for one.
How many regulatory gates must the deal clear?
GLJ Research analyst Gordon Johnson warns the merger would need approval from multiple governments, including China, a process that "could take two to three years."
The market's consensus timeline is 12 to 18 months; Black considers that far too aggressive.
This means → if the regulatory cycle doubles, the merger premium baked into the current share price could steadily deflate.
If merger expectations cool, how far could the stock fall?
Johnson rates Tesla a sell with a target below $30, warning that fading merger hopes could trigger $40–50 of downside — roughly 10%.
FactSet data shows the analyst consensus target is about $407, with no SpaceX acquisition premium factored in.
This reflects a sell-side pricing model that has no room for the merger at all — once the narrative fades, that "invisible cushion" disappears.
Setting the merger aside, what supports Tesla's own valuation?
Tesla trades at roughly 173× forward P/E. The valuation thesis rests on AI progress: Robotaxi and the humanoid robot Optimus.
Robotaxi launched in Austin, Texas in June 2025, but expansion has been slow; there is no clear timeline for Optimus to contribute meaningful revenue.
Musk will address both businesses on the July 22 Q2 earnings call — making it the near-term inflection point for the valuation narrative.
What is the stock price saying right now?
At the time of reporting, Tesla shares were down about 3% intraday at $379.30.
In plain terms = the market is pricing two things at once: the upside imagination of a merger, and the risk it never happens — and the latter is growing.
Content is for reference only, not financial advice.