Wall Street has spent the past year watching rockets the way it once watched chip stocks. Launch schedules, satellite contracts, and IPO calendars have become dinner table conversation for a certain kind of investor.The pace of new listings has only accelerated that shift. Now one of the biggest names in finance is putting a number on where all of that momentum is headed.The figure is big enough to change how investors think about the sector entirely, not just as a niche theme but as a genuine asset class.Goldman Sachs projects $1.8 trillion space economy by 2035Space is moving from a government-led frontier to an institutional asset class, according to a report published August 13 by the Goldman Sachs Global Institute.Falling launch costs, private investment, and public market funding are reshaping what the bank calls the orbital economy.Titled “The Second Space Age,” the report describes space as becoming a new pillar of the industrial economy, complete with its own supply chains and infrastructure nodes, according to Goldman Sachs. The firms and countries that control launch capacity, manufacturing, orbital infrastructure, and space-derived data will shape how value gets created across the sector.More SpaceX:Morgan Stanley says SpaceX investors miss the bigger storyPeter Schiff says SpaceX is a warning for hyped stocksSpaceX stock defies latest Wall Street forecastsThe structural driver behind all of it is the collapse in launch costs. Getting one kilogram into low Earth orbit cost $65,400 in 1981. Today it costs roughly $1,500. That 98% reduction in cost is what turned space from a government program into a business opportunity.The bank projects the global space-based economy will reach $1.8 trillion by 2035. More than $55 billion flowed into the space ecosystem in 2025. The first quarter of 2026 alone posted a record $36 billion of investment, a pace that has surprised even bullish analysts.U.S. Defense Department space spending is also growing fast, rising from $11.9 billion in 2020 toward $59.7 billion projected for 2027, a compound annual growth rate of 26%.That kind of capital velocity is exactly what turns a niche sector into an institutional one. Investors who once treated space as a speculative side bet are now building it into core portfolio allocations, alongside themes like AI infrastructure and cloud computing.SpaceX SPCX IPO and space stocks record $89 billion in new listingsThe shift is also reaching public markets in a big way. Since the start of 2025, aerospace companies have raised $89 billion through IPOs.Goldman said that reflects the broader institutionalization of space as a distinct sector within public equity markets.Several recent listings illustrate the trend. Firefly Aerospace raised roughly $999 million in its IPO after its Blue Ghost lunar mission. York Space Systems raised about $629 million to support its satellite manufacturing business. HawkEye 360 raised close to $416 million to expand its signals intelligence platform.SpaceX towered over all of them. The company priced its June IPO at $135 a share, raising $75 billion in what became the largest public offering in history. Shares jumped 19% on their first day of trading to close at $160.95, according to CNBC. That single listing reset how the entire market prices everything else tied to the orbital economy.The excitement has not translated into a straight line higher, though. SpaceX shares have swung sharply since their debut, falling well below their IPO price at points over the summer before stabilizing. Even so, the underlying business has kept adding to its order book, including a recent $1.6 billion Space Force contract covering 18 launches through 2027, according to TheStreet.
Wall Street has spent the past year watching rockets the way it once watched chip stocksNick/Getty Images
Goldman Sachs Wall Street space sector analyst targets and investment outlookGoldman is not just an observer here. Its own asset management arm has leaned into the same theme, identifying economic security as a major investment theme for 2026. It highlighted opportunities in defense, energy, infrastructure, critical supply chains and national-security capabilities.That kind of institutional conviction matters because the next stage of space industrialization will require enormous upfront investment. Future capital needs include launch capacity, satellite factories, lunar infrastructure, space-based data platforms, and resilient communications networks.All of that requires significant capital to build and scale, and even longer to turn profitable. Patient capital will matter as much as engineering expertise.Analyst opinion on individual names remains split even as the broader thesis gains believers. Raymond James has set an $800 price target on SpaceX, one of the boldest calls on the Street. HSBC started coverage at hold with a target of just $115.Morgan Stanley has taken a similarly wide stance, with a $75 bear case, a $300 base case and a $600 bull case on SpaceX following the company’s Cursor acquisition, according to TheStreet. That spread between bull and bear cases shows just how unsettled valuations remain, even with Goldman’s trillion-dollar framing sitting in the background.Orbital economy launch chokepoints and what space investors should watch nextGoldman’s core argument is that companies combining technical execution with public market credibility will be best positioned to scale and consolidate.Access to capital may become a competitive advantage in its own right, not just a byproduct of good engineering.That framing puts pressure on smaller, less-capitalized space companies to either merge, partner, or find their own path to public markets. Capital is increasingly concentrating around the industry’s largest players.Fortune has noted that several already-public names, including Rocket Lab, AST SpaceMobile, and Firefly, are emerging participants in an increasingly valuable space economy, even as SpaceX has established itself as the industry’s dominant player.For now, investors are left weighing a genuinely trillion-dollar long-term thesis against short-term volatility that has already whipsawed some of the sector’s biggest names.Goldman’s own framing suggests that tension will not resolve quickly. Patience may end up mattering as much as conviction for anyone trying to ride the theme from here.Related: Morgan Stanley doubles down on SpaceX stock for investors