Wall Street locks in EchoStar Corporation Class A (SATS.US) as SpaceX's best alternative! Citigroup and Deutsche Bank both call for a buy.

SpaceX (SPCX.US) may have finally opened its doors to public market investors, but Wall Street analysts say that investing indirectly in this space technology company through EchoStar Corporation Class A (SATS.US) is actually a lower-cost way compared to buying SpaceX stocks directly. Citigroup analyst Michael Rollins, Inc. resumed coverage of EchoStar Corporation Class A with a "buy" rating and a target price of $126. He stated that in the next year, as the price of SpaceX is expected to rise further, combined with the ongoing restructuring of EchoStar Corporation Class A's business, the company will benefit from it. Rollins, Inc. wrote in a report to clients on July 7: "We still believe that the continuous monetization of spectrum assets, potential sales of video business and other assets, as well as the anticipated tax-adjusted value of holding SpaceX shares in the future, will create significant value." EchoStar Corporation Class A owns Boost Mobile mobile communication business and satellite television operator Dish. In 2025, the company will sell part of its spectrum licenses to SpaceX in exchange for SpaceX shares that are not yet listed at the time. After the transaction is expected to be completed in the second half of 2027, EchoStar Corporation Class A will receive more SpaceX stocks. Due to holding SpaceX stocks, EchoStar Corporation Class A is considered the "shadow concept stock" of SpaceX in the market. From the beginning of this year to the end of May, during the period when SpaceX submitted its S-1 listing application, EchoStar Corporation Class A's stock price had risen by about 30%. However, since SpaceX completed its record-breaking $86 billion IPO in June, EchoStar Corporation Class A stock price has dropped by nearly 24%; in contrast, the newly listed SpaceX stock has increased by about 13% since the IPO price. Deutsche Bank Aktiengesellschaft analyst Brian Kraft also resumed coverage of EchoStar Corporation Class A this week with a "buy" rating and a target price of $143. He stated in his latest report that since SpaceX went public, the stock prices of the two companies have shown a significant divergence, providing an opportunity for investors. Kraft pointed out that on a per-share basis, the value of SpaceX shares held by EchoStar Corporation Class A is about 20% higher than the current stock price of EchoStar Corporation Class A. He stated: "This means that investors not only almost get EchoStar Corporation Class A's other assets for free, but also buy SpaceX at a discount of about 20%." Kraft added that this is especially attractive for certain types of investors. He wrote: "For value-oriented funds, EchoStar Corporation Class A may be a very good choice. Such funds may not want to invest directly in SpaceX because it is considered an overvalued growth stock, but through EchoStar Corporation Class A, they can get the exposure at a more attractive price." This week, as the IPO quiet period ended, major Wall Street banks began covering SpaceX (SPCX.US), with a clear consensus to buy the stock. Data shows that the average target price is around $236, indicating a potential increase of over 55% from the current price. The prospects of SpaceX stock rising are undoubtedly beneficial for EchoStar Corporation Class A, which holds shares in the company. In addition to holding SpaceX shares, analysts believe that the remaining spectrum assets of EchoStar Corporation Class A, as well as businesses like Boost Mobile, Hughes, and Sling TV, also have growth potential. Furthermore, Wall Street also sees potential for EchoStar Corporation Class A stock price to rise further as the discount of net asset value (NAV) narrows, disputes related to communication towers are resolved, and the Dish DBS bankruptcy restructuring progresses. New Street Research analyst David Baden stated that despite Dish DBS filing for bankruptcy protection earlier this month, considering the SpaceX shares held by EchoStar Corporation Class A, the company's fair value can still reach $165 per share. Baden wrote in his report: "At such a steep discount level, we believe that EchoStar Corporation Class A is an extremely attractive way to indirectly hold SpaceX shares."