SpaceX made a highly anticipated debut on the Nasdaq, closing at $161 per share, which represents a 19% jump from its offer price of $135 per share [1]. The IPO has been described as 'stratospheric,' with founder Elon Musk becoming the world's first trillionaire as a result of the listing [1]. Retail investors played a significant role, purchasing $100 billion in shares, highlighting strong enthusiasm for the stock [1].
Despite the initial optimism, several analysts have raised concerns about SpaceX's valuation. The company's current valuation stands at $1.75 trillion, which implies a price-to-earnings (P/E) ratio of nearly 100 times—substantially higher than Nvidia's P/E of just over 31 and Apple's at about 35 [1]. Morningstar equity analyst Nicolas Owens stated that the stock is 'significantly overvalued,' assigning a fair value estimate of $63 per share and noting only a 7% chance of reaching its 'moonshot' scenario of $154 per share [1]. Matthew Maley, Chief Market Strategist at Miller Tabak, echoed these concerns, agreeing that while the IPO went well, the stock is 'much too overvalued' [1].
Elon Musk, in a now-deleted post on X, suggested that SpaceX 'might be able' to reach approximately $1 trillion in revenue by 2030 and would be 'surprised' if revenue is not greater than that by 2031 [1]. However, Steve Westly, founder of The Westly Group and former Tesla board member, cautioned that retail investors could become panicky if SpaceX misses revenue or earnings expectations in the coming quarters, given the aggressive growth already priced in [1].
Despite valuation concerns, some analysts remain optimistic about SpaceX's long-term prospects. Both Maley and Westly expressed that very long-term investors could still see positive returns if they are willing to ride out potential volatility [1].
CONCLUSION
SpaceX's Nasdaq debut was met with strong investor enthusiasm and a sharp price increase, but analysts caution that the current valuation may be difficult to justify without exceptional growth. While long-term prospects remain promising, the market is likely to be sensitive to any missed expectations in the near term. Investors should be prepared for potential volatility as the company works to meet ambitious targets.