SpaceX, Elon Musk’s aerospace venture, is heading toward its long-anticipated debut on the Nasdaq today (12th June). The full name is Space Exploration Technologies (NSQ:SPCX) – love the name and Musk won’t damage it.
According to its prospectus, the IPO price is set at $135 per share, with 555.6 million shares to be issued, raising about $75 billion and valuing the company at nearly $1.8 trillion. As markets prepare for the listing, investors will be closely monitoring its potential impact across technology, aerospace, semiconductor, and broader equity markets.
SpaceX is reported to be massively oversubscribed, with more than four times the demand than the quantity of shares that are actually available.
Official pricing is today (at the fixed price of $135 per share) and trading in the shares should begin tomorrow.
At a $1.8 trillion valuation, it will be more valuable than Tesla (NSQ:TSLA) and Meta Platforms (NSQ:META) but not quite as valuable as the likes of Amazon.com (NSQ:AMZN) and Microsoft (NSQ:MSFT). It will be a top 10 stock in the US by market cap.
SpaceX IPO: A Landmark Debut, a Monster Valuation, and a Lot of Hype
In historical terms, this is a genuine landmark moment. Alibaba Group Holding (NYQ) came to market in 2014 with a valuation of around $169 billion at its IPO price, which felt enormous at the time. Saudi Aramco was valued at about $1.7 trillion when it listed in 2019, although it raised “only” $29 billion.
SpaceX, by contrast, is looking to raise $75 billion – and apparently could have raised a lot more.
My own view is that we may now be entering the stage of a long-term bull market where the most popular shares start to detach completely from conventional fundamentals. I have already mentioned the price-to-sales multiples being discussed for SpaceX, which are very hard to justify using any traditional valuation framework. But then again, perhaps this time really is different?
Just for fun I will break protocol and let everyone know how IPO subscriptions go. The “bank” rings a high profile fund manager and asks if he is interested. The PM feigns interest and asks how much stock he is likely to get….at which point he is told off the record that orders will likely be scaled back 75%…..so PM needs to put in for 4x what he actually wants in order to get the right amount. So everyone puts 3-4x what they want and it all kinda works with +10-15% rise on day one some of these nice chaps decide to lighten the load. This all falls down when occasionally the 3-4x is wrong…. and calls go out the night before and morning to let PMs know they did a little better than expected….and successfully got say 50% or more. Now you have a stock that may only pop 2-3% or down even…and PMs have 2x the stock they want. Colleagues fall around laughing at naivety of PM. In theory it’s a bad day for the bank too if the stock falls but they still collect their fee!!! And my point….. over subscribed?? I would hope so…but don’t believe the hype. 10% first move won’t be enough with this one – no PM will want to admit losing money on this….price could do anything from +40% to -40% in first day. That’s an option not an equity.
#spcx #spacex #nasdaq
Here’s a crazy stat for you!
The IPO is listed at 100x sales ($1.75tn cap Vs $18bn in sales)
If the stock falls 90% it will still trade at 10x revenues…
This might be the peak of the #bubble
