Morgan Stanley analyst Adam Jonas believes China's rapidly-advancing space sector poses a credible, long-term threat to SpaceX (SPCX). The China Aerospace Science and Technology Corp. (CASC) recently achieved a major milestone by successfully recovering a reusable rocket booster for the first time. Until now, only Elon Musk's SpaceX and Jeff Bezos' Blue Origin have achieved this feat.

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Jonas said U.S. Space Force officials had previously estimated that China was still three to five years away from developing reliable reusable rocket technology. However, the successful Long March 10B test suggests China may be making faster progress than expected.

Jonas reiterated his Buy rating and $300 price target, which implies 106.5% upside potential from current levels. He is a four-star analyst on TipRanks, ranking #2,064 out of the 12,381 analysts tracked. Jonas has a 52% success rate and an average return per rating of 5.40%.

Here's What China's CASC Achieved

According to Jonas, recovering the Long March 10B rocket booster marks an important step toward developing fully reusable rockets. However, he noted that China still needs to prove it can launch, recover, and reuse the same rockets consistently, at lower costs, before the technology is ready for regular commercial use.

He added that China has built a strong space industry, supported by government-backed programs and private rocket companies like LandSpace, Galactic Energy, and Space Pioneer.

Jonas also noted that China completed 90 orbital rocket launches in 2025, making China the world's second-most active country for space launches. However, SpaceX alone conducted 165 Falcon 9 launches during the same period.

China Also Competes In Satellite Internet

Jonas highlighted China's bigger space plans that could compete with Starlink's internet services. China is working on the Guowang and Qianfan satellite networks, which aim to deploy about 28,000 low-Earth orbit (LEO) satellites. In addition, China has proposed launching more than 190,000 other non-geostationary satellites in the future.

In the meantime, China is also spending heavily on space-based computing. Jonas noted that China recently launched the first satellites for its planned "Star Compute" network, which is expected to include 2,800 satellites working together as an orbiting supercomputer.

Despite China's recent progress, Jonas remains bullish on SpaceX's lead in rocket launches and reusable rocket technology. However, he warned investors not to underestimate China's rapid progress in catching up.

Is it Too Late to Buy SpaceX?

On TipRanks, SpaceX has a Strong Buy consensus rating based on 22 Buys, four Holds, and one Sell rating. The average SpaceX price target of $245.96 implies 69.3% upside potential from current levels. Since its initial listing in June, SPCX shares have dropped 9.7%.