We Think the SpaceX IPO Is Overvalued
Key takeaways
- Reginald Mathalone/Nur Photo via Getty Why Is Morningstar So Bearish on Space X’s IPO?We value Space X at $63 per share, a 53% discount to the upcoming IPO’s offering price.
- Neither of these engineering problems has been solved, and we don’t expect them to be until at least 2028.
- In our most optimistic “moonshot” scenario, the company would be worth $1.97 trillion, or $154 a share.
Home Stocks Why We Think the Space X IPO Is Overvalued Why We Think the Space X IPO Is Overvalued Even giving Space X the benefit of the doubt in several key forecasts, only the most optimistic ‘moonshot’ scenario approaches the IPO offering price.
Reginald Mathalone/Nur Photo via Getty Why Is Morningstar So Bearish on Space X’s IPO?We value Space X at $63 per share, a 53% discount to the upcoming IPO’s offering price. Our valuation is the result of mathematics more than skepticism. With such a wide range of possible outcomes for the company’s financial future, we created forecasts and valuations for three scenarios and probability-weighted them.
Even at $63 per share, we give SpaceX a lot of benefit of the doubt in two of the three scenarios, in which we assume the company can achieve a rapidly reusable Starship rocket enabling multiple launches per week and successfully commercialize data centers in space. Neither of these engineering problems has been solved, and we don’t expect them to be until at least 2028.