All space stocks soar in anticipation of SpaceX’s impending IPO
It appears SpaceX’s upcoming initial public offering (IPO) of publicly-traded stocks, now anticipated to raise as much as $75 billion for the company, has caused stock investors to also pour their money into a whole range of space stocks, causing them all to soar in value.
Initially, it was expected that the IPO could raise $50 billion for the company, but the latest report indicates it could raise as much as $75 billion, with a valuation as high as $1.75 trillion. The colossal figures being thrown around on Wednesday have garnered excitement among investors for other space stocks that are already publicly traded.
Here were the top gainers in the session:
- Firefly Aerospace: +19%
- Intuitive Machines: +11%
- AST SpaceMobile: +9%
- EchoStar Corporation: 9%
- Rocket Lab Corporation: +8%
The most recent indications suggest SpaceX will file the offering’s prospectus in the next week or so. If the predictions about it are correct, and SpaceX does raise $75 billion, it would then have on hand more than three times the cash that Congress normally budgets annually to NASA, with an ability to use that money far more effectively.
As I have been saying now for more than a year, the real space program for the United States is being run by SpaceX, not NASA. Expect SpaceX to outpace NASA in their parallel and complementary efforts to build a moonbase.
On Christmas Eve 1968 three Americans became the first humans to visit another world. What they did to celebrate was unexpected and profound, and will be remembered throughout all human history. Genesis: the Story of Apollo 8, Robert Zimmerman's classic history of humanity's first journey to another world, tells that story, and it is now available as both an ebook and an audiobook, both with a foreword by Valerie Anders and a new introduction by Robert Zimmerman.
The print edition can be purchased at Amazon or from any other book seller. If you want an autographed copy the price is $60 for the hardback and $45 for the paperback, plus $8 shipping for each. Go here for purchasing details. The ebook is available everywhere for $5.99 (before discount) at amazon, or direct from my ebook publisher, ebookit. If you buy it from ebookit you don't support the big tech companies and the author gets a bigger cut much sooner.
The audiobook is also available at all these vendors, and is also free with a 30-day trial membership to Audible.
"Not simply about one mission, [Genesis] is also the history of America's quest for the moon... Zimmerman has done a masterful job of tying disparate events together into a solid account of one of America's greatest human triumphs."--San Antonio Express-News
It appears SpaceX’s upcoming initial public offering (IPO) of publicly-traded stocks, now anticipated to raise as much as $75 billion for the company, has caused stock investors to also pour their money into a whole range of space stocks, causing them all to soar in value.
Initially, it was expected that the IPO could raise $50 billion for the company, but the latest report indicates it could raise as much as $75 billion, with a valuation as high as $1.75 trillion. The colossal figures being thrown around on Wednesday have garnered excitement among investors for other space stocks that are already publicly traded.
Here were the top gainers in the session:
- Firefly Aerospace: +19%
- Intuitive Machines: +11%
- AST SpaceMobile: +9%
- EchoStar Corporation: 9%
- Rocket Lab Corporation: +8%
The most recent indications suggest SpaceX will file the offering’s prospectus in the next week or so. If the predictions about it are correct, and SpaceX does raise $75 billion, it would then have on hand more than three times the cash that Congress normally budgets annually to NASA, with an ability to use that money far more effectively.
As I have been saying now for more than a year, the real space program for the United States is being run by SpaceX, not NASA. Expect SpaceX to outpace NASA in their parallel and complementary efforts to build a moonbase.
On Christmas Eve 1968 three Americans became the first humans to visit another world. What they did to celebrate was unexpected and profound, and will be remembered throughout all human history. Genesis: the Story of Apollo 8, Robert Zimmerman's classic history of humanity's first journey to another world, tells that story, and it is now available as both an ebook and an audiobook, both with a foreword by Valerie Anders and a new introduction by Robert Zimmerman.
The print edition can be purchased at Amazon or from any other book seller. If you want an autographed copy the price is $60 for the hardback and $45 for the paperback, plus $8 shipping for each. Go here for purchasing details. The ebook is available everywhere for $5.99 (before discount) at amazon, or direct from my ebook publisher, ebookit. If you buy it from ebookit you don't support the big tech companies and the author gets a bigger cut much sooner.
The audiobook is also available at all these vendors, and is also free with a 30-day trial membership to Audible.
"Not simply about one mission, [Genesis] is also the history of America's quest for the moon... Zimmerman has done a masterful job of tying disparate events together into a solid account of one of America's greatest human triumphs."--San Antonio Express-News
But…but…everyone knows that everything the fascist Musk touches is a failure! How can there possibly be an IPO for such a worthless organization!?
Growing too quickly as a company is a source of trouble. If they raise that whole amount, then they need to be careful and judicious with it, growing the company at a rate that can be handled. If they spend the $75 billion all at once, that is a 300% or more sudden growth.
I guess I am saying, “Don’t spend it all in once place.”
I think that investors have been expecting growth for the past decade. The difference now may be that commercial space has already weeded out the less realistic, less thought out, more speculative ideas and are now moving into areas that are more likely to succeed. I suspect that the article is correct, that the IPO is showing everyone that space has become a growth sector. There are an increasing number of companies becoming successful, and the success of SpaceX is showing that success can grow a company quickly.
Rocket Lab’s price may have shot up due to its wide variety of successful endeavors in the space sector. They do much more than mere launches, but the launches are most visible.
Elon Musk also is turning Tesla into a robot manufacturer. Because he intends to manufacture them on Earth and use some of them in space, I expect that they will eventually be relatively lightweight.
‘Trickle down economics’. Who’d a thunk?
I will wager right now that when the IPO hits, there will be the usual wailing and gnashing of teeth from the usual suspects about people, who, for whatever reason, are being ‘left behind’. Takers?
Edward,
A $75 billion capital raise would allow SpaceX to kick in at least half of the estimated $20 billion cost of Elon’s just-announced Terafab project and still leave plenty to pay for the expensive earliest days of lunar industrialization. SpaceX won’t be spending it all at once, but, once it knows what it will have to play with, it can allocate capital tranches to a number of expensive projects in maximally parallel fashion.
Dick Eagleson,
Hmm. SpaceX has Starlink, a cash cow that is still growing, and I am not convinced that it needs to sell stock in order to afford $75 billion in expenses over the next half decade. I’m not even convinced that it needs the whole amount of the originally announced $50 billion, making the selling of stock even that much less necessary. If it does not need the cash now, why collect the cash now? It can raise cash without selling stock, as it has in the past, therefore it does not need to know how much cash is available in order to make plans.
Starship can quickly turn into a huge cash cow on its own, if it becomes a revenue generator in the next couple of years. A few years ago, SpaceX thought that it could launch a Starship for $2 million. After inflation, amortizing development and manufacturing costs, and assuming they were optimistic we can probably assume that they were off by an order of magnitude. With the announced launch price of $90 million for the Starlab launch, we can assume a profit for each low Earth orbit launch of around $70 million. Similar to the Falcons, once operational we can expect business to boom for Starship, too. The plummet in the cost of launching Starlink will free up much more cash for SpaceX to use; they had expected to have that cash available to them a year or two ago.
Much of my concern is that SpaceX, once it has a lot of cash in hand, may turn into Blue Origin instead of remaining SpaceX. Blue Origin elied more on the cash available rather than in frugal use of what little cash it had, and I would hate to see SpaceX turn the same way. It is easy to change a corporate culture from disciplined to indolent, as happened to Hewlett Packard a couple of decades ago, but difficult to change one toward a more disciplined approach to business. Becoming more disciplined is difficult for anyone. Just look at raising kids. Look at boot camp.
I can think of a couple of reasons why SpaceX may want to raise cash now.
Early on in Tesla’s history, Musk bought up, and vertically integrated, the necessary expertise and resources to manufacture EV’s. When everyone else got into the game, they found that Tesla had locked up everything they needed, significantly raising the barrier to entry. It’s a competitive advantage; when no one else can compete.
There is also the time-value of money. it’s cheaper to lock in contracts now, than wait until you actually need them. Airlines used to buy fuel, this way. And, as noted, space-related capabilities are only going to get more expensive. Putting money down now, is a hedge against inflation, and Democrats. It may be that SpaceX wants to put as much exo-structure in place as possible, before the next election.
Blair Ivey,
“When everyone else got into the game, they found that Tesla had locked up everything they needed, significantly raising the barrier to entry. It’s a competitive advantage; when no one else can compete.”
This would harm the space economy and is one of the things that we all fear SpaceX could do. I certainly hope this is not the plan.
“There is also the time-value of money. it’s cheaper to lock in contracts now, than wait until you actually need them. Airlines used to buy fuel, this way.”
This is true, but it is a good strategy for well established businesses that can predict their future needs.
When starting a new enterprise, even for a large corporation, it is best to ease into the new business. Huge amounts of money and time can be wasted by anticipating what is needed for the new endeavor, buying it all right away, only to discover that you were wrong about the market or how quickly it would grow or the direction it would grow in. I worked for one company that merely moved its facilities, yet they started with a minimum of what was needed and expanded its facilities over time to meet the demand and the changing business conditions.
“It may be that SpaceX wants to put as much exo-structure in place as possible, before the next election.”
That sounds good, and all, but Democrat have a large box of tools to screw anyone they choose. It is why Musk builds so little in California. Like New York, California sent messages to the job creators that they don’t like, with a lot of spillover onto those that they did like.