BNP Paribas: Tesla-SpaceX merger wouldn't help investors — keeps $280 price target
BNP Paribas reaffirmed its skeptical view on a Tesla-SpaceX merger, <em>keeping</em> its underperform rating and $280 price target — the firm estimates combined cash burn of $216B through 2026-2031, warning a merger could add financial strain rather than ease it.
As Tesla-SpaceX merger speculation has gripped Wall Street for nearly two months, BNP Paribas analysts led by James Picariello struck the most skeptical tone yet, maintaining an underperform rating and $280 price target on Tesla.
The core concern is cash. BNP estimates SpaceX's cumulative cash burn at $216 billion through 2026-2031 — roughly $30 billion this year alone and about $194 billion by 2030. Combined with Tesla's own multi-year cash burn cycle starting this quarter, the analysts see a heavy financial load for any combined entity.
Regulatory and governance hurdles were also flagged. SpaceX holds extensive U.S. government and defense contracts, meaning any deal would need multi-jurisdiction regulatory approval plus a Tesla shareholder vote — a process the analysts expect to take considerable time.
BNP also laid out specific valuation math: even a 30-40% takeover premium would only justify a fair value of $360-390 a share, and weighting that by roughly a 50% probability of the merger actually happening cuts the premium's effective value in half. The analysts added that a combined entity would likely need to raise additional capital, further diluting existing Tesla shareholders.
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