tech
SpaceX will get off the ground – but a descent from a silly valuation must follow
Investors will buy into the market-leading tech and cult of Musk despite a price that is defying gravity
TL;DR
- SpaceX's IPO valuation is almost 100 times its 2025 revenues, driven by potential future ventures.
- Market-leading divisions like Starlink and rocket technology do not fully support the $1.77tn valuation.
- The artificial intelligence operation xAI is a key driver of the high valuation, with most IPO funds allocated to it.
- Despite analyst concerns about overvaluation, the "Musk factor" and strong Wall Street support are expected to buoy the IPO.
- Forced buying by passive tracker funds, which must invest in companies added to indices, will also contribute to demand.
- A future descent to a more realistic valuation is predicted by some analysts.