What About SpaceX?
I’ve been investing since the 1980s. Investing is the buying of an asset that you intend to keep for years or decades. Which brings me to the recent SpaceX IPO. During the last thirty years, there have been many businesses that have gone public with losses. Some of them turn into wild successes. Many are not.
NVIDIA is an established company and a recent AI success story. Their CEO made calculated bets on the future twenty years ago that have been paying-off the last five years in particular. It trades at 31-times earnings and 21-times profit. These are actual, not forecasted results.
A $10,000 investment in NVIDIA stock on June 15, 2015 is now valued at $2,204,870 on June 19, 2026. The compound growth rate (CAGR) of that investment has been 62.97% per year. Another way to think about it—the investment doubled in value, every 15.5 months. Let’s compare SpaceX to Nvidia.
SpaceX has revenues of $19 billion and Elon Musk is telling investors SpaceX’s market is $28 trillion over the next decade. He isn’t promising anywhere close to a CAGR of 62% between now and 2037. While I respect Musk’s ability to innovate and imagine the future, I can’t bring myself to a level of belief that makes me believe SpaceX is a good investment today.
SpaceX stock price at June 19, 2026 is $185/share. Its market capitalization is $2.43 trillion. Its revenues are $19 billion. And it loses money—$4+ billion per year. Let’s ignore that for now and focus on revenues. Its price to sales ratio is 127.9. Remember, NVIDIA is trading at 21 times revenue.
Do you think SpaceX is much better than NVIDIA at its current price? Do you think it could be much larger than NVIDIA a decade from now? Do you think it will ever be more profitable than Nvidia, Apple, Microsoft?
SpaceX’s current stock price assumes the company will grow to more than $100 billion in revenue quickly and be very profitable in the future. We don’t know when. At nearly 128 times revenue versus 21 times revenue for NVIDIA, I’m not buying SpaceX. Too much hopium in that price.
The odds of SpaceX even becoming profitable by 2030 are slim. It is more likely the company will sell more stock and add more debt between now and the end of the decade. Building data centers in outer space is an expensive proposition. Current shareholders are going to experience dilution because SpaceX may sell more stock or borrow large sums to finance capital investment.
This IPO benefits Wall Street investors who got in at pre-IPO special prices, early private equity investors, company employees, and Elon Musk. He owns 849,490,000 of SPCX common stock per the IPO Prospectus. If SpaceX stock price were to fall 90% from where its price is today, his shares would be worth only $15.7 billion. That’s not terrible outcome what would be a dismal failure.
You need to be a committed investor to buy SpaceX at the current price. Your failure mode will be less lucrative.