Key facts
- SpaceX's IPO closed at $161 per share, up 19% from its $135 offer price.
- Elon Musk projected SpaceX could achieve approximately $1 trillion in revenue by 2030.
- Some market strategists and analysts believe SpaceX's valuation is excessively high.
- Insiders and employees are now able to sell shares following the expiration of a stock lock-up period.
SpaceX, the rocket company founded by Elon Musk, has made its debut on the Nasdaq, with its shares closing at $161 on the first day of trading, a 19% increase from its offer price of $135. This strong initial performance has fueled optimism among investors, with some retail investors reportedly buying $100 billion in shares. Elon Musk has projected that SpaceX could achieve approximately $1 trillion in revenue by 2030.
However, the company's valuation has drawn scrutiny. Some experts, including Matthew Maley of Miller Tabak and Nicolas Owens of Morningstar, believe the IPO is overvalued. Morningstar has assigned a fair value estimate of $63 per share and suggests only a 7% chance of reaching a $154 per share 'moonshot' scenario. The current valuation implies a price-to-earnings ratio of nearly 100 times, significantly higher than that of tech giants like Nvidia (31x) and Apple (35x).
Following the IPO, employees and other insiders are now subject to a stock lock-up expiration, allowing them to begin selling their shares. Analysts like Steve Westly have cautioned that investors may become concerned if SpaceX misses growth projections in subsequent quarters, emphasizing the need for the company to deliver results quickly. Despite these concerns, long-term investors may still find the stock a worthwhile buy, with Westly and Maley expressing optimism for the company's future, particularly highlighting the combined leadership of Elon Musk and SpaceX President Gwynne Shotwell.