SpaceX IPO is already crashing

追加: 2026-06-08

[00:00:00]SpaceX is trying to raise the largest IPO in history, raising $75 billion at almost $2 trillion valuation.

[00:00:09]That's an insane valuation, and I made a whole video showing with that valuation makes absolutely no sense. Now, I don't have personally anything against SpaceX or Elon Musk, but when you try so much money at the valuation when your best valuation should not be more than $500 billion.

[00:00:28]I would even understand if they tried to raise it at a trillion dollar valuation, but $2 trillion makes no sense. And now they're trying to create this FOMO effect around SpaceX so that people like you will go and buy the stock because you don't understand much about investing, and that's what they're counting. Look at this article by Reuters. SpaceX is drawing investors demand of about $150 billion for its IPO.

[00:00:55]So, essentially they're trying to say that investors want double the amount that SpaceX is offering. SpaceX wants to raise $75 billion, but investors are willing to pay SpaceX $150 billion. Now, suddenly if you're an investor and you look at that, you're like, "Maybe I should get that stock now before everyone else gets it." Without knowing that right after the IPO, the stock is going to collapse.

[00:01:21]And probably, especially within the first year of the stock going public, the stock is going probably lose like 50% of its valuation.

[00:01:31]Now, if you scroll down and see that, they say that it's the only company that can escape the limitations of earthbound businesses and use space to build AI compute capacity that expects to draw enormous demand in the future.

[00:01:46]And that is true. That's true that it's the only company that can send rockets to space and can build data centers in space. But why would I pay the valuation for a company that hasn't achieved that yet? If SpaceX will achieve that in the next 5 to 10 years, and I will pay the valuation today, then it means that for 10 years, I won't be making any money on my money as well. I won't be making any money on my investments. And that's the problem that I have with this IPO.

[00:02:18]The most important question is, why would SpaceX even go public now? Why didn't the company go public like last year, or 2 years ago, or 3 years ago?

[00:02:28]And that's because something fundamentally has changed about the business. When you're a publicly traded company, you're accountable to your shareholders. So, you have to release your quarterly reports, the financial statements, the income statements, the balance sheet. And if Wall Street is not going to like your statements, Wall Street is like, listen. This company is not making as much profits as we thought. They're not beating market's expectations, so we're going to dump this stock. But now there SpaceX has essentially created two products that bring consistent cash flow to the business. The first of all, it's that they have actually perfected the reusable rockets. Now, they build a rocket, that rocket can send cargo to space 20 to 30 times, and no one else can do that. So, they essentially have like 80% of the market, which means that they're a monopoly.

[00:03:19]But, they have built a second business, which is far more important than the first business, and that's Starlink. And Starlink offers a subscription. Now, they can offer their services not just to the US-based clients, but rather across the globe. Now, they're competing with everyone else. And that's a recurring revenue. So, if we know these are the number of users, we can expect this much money to come to SpaceX every single month, and we can basically give it some kind of evaluation. And if you're any kind of an investor, and you want to give it evaluation to SpaceX, then you know, all right. Let's say SpaceX has 1 million users, and the potential pool of the number of users could be 100 million.

[00:03:58]And based on that math, you can expect SpaceX to take over all of these 100 million people, and suddenly you're going to give it a very high valuation.

[00:04:07]So, I think Starlink is playing probably the most important role why the company is going public. But the problem is that they're trying to raise so much money that no one else has ever done it in history.

[00:04:18]They want to raise 75 billion dollars.

[00:04:21]Now, the second largest IPO was by Saudi Aramco when they raised 29 billion dollars in 2019. Now, you could understand the difference that Saudi Aramco is the company that controls and owns the entire oil in Saudi Arabia, the country that has the most amount of oil in the world, and they can produce it at the cheapest possible price. So, they have this consistent cash flow, all that money from Saudi Arabia, all that oil from Saudi Arabia getting sold to the rest of the market, and Saudi Aramco is making that money. So, there was a reason why would investors invest in Saudi Aramco. But if you look at this list, and you try to find what is the next tech company? Yes, you can see Alibaba, but it's a Chinese business.

[00:05:05]The next tech US-based company is Facebook, and they raised 16 billion dollars. They went public like in 2008 or 2009. It was one of the largest IPOs.

[00:05:16]So, the fact that SpaceX now wants to beat literally every single expectation, that's where investors have a huge problem.

[00:05:24]And here's the question, who is going to invest that much money in SpaceX?

[00:05:28]Now, here was the initial plan. If we can make SpaceX so huge that every single ETF will invest in SpaceX because they have to. Imagine you have an S&P 500 ETF like from Vanguard, Fidelity, you name it. Now, their job is to invest in the S&P 500. If we can get SpaceX into the S&P 500. Now, every single ECE ETF now has to invest in the SpaceX, which means that now we have created demand for it. So, whether you like it or not, billions of dollars is going to go to the business. But, unfortunately, that's not happening because at least the S&P 500 is not going to accept it.

[00:06:06]Let me show you why. Look at Apple.

[00:06:08]Apple went public in 1980 and it became part of the NASDAQ 100 in 1985 and part of the S&P 500 in 1982.

[00:06:18]So, because there is a list of requirements to be listed in one of these ETFs or one of these indexes, you got to stay in the market for some time so that the market watches you, they know what you're doing, you're profitable, you're growing, uh you're meeting investors' expectations, and because of that we can put you on this list. But, when you're getting into the market the first day, how can we possibly get you into the S&P 500? Look at Amazon. They went public in 1997.

[00:06:45]They gets They got listed on NASDAQ 100 1998, and now they became part of the S&P 500 in 2005, which makes perfect sense. And that's pretty much the case with every other major company, especially tech company. Here is the question. What does qualifies you to become part of the S&P 500? The first of all, you should be listed in the NASDAQ for at least 2 years. They can make exceptions like they made for Google, but let's assume that they don't have to be there for 2 years. But, at least you got to be there for some time, maybe at least a month or 2 months, maybe one single quarter at least.

[00:07:20]Let assume that they will pass that.

[00:07:22]Among 100 largest non-financial companies by market cap. Of course, SpaceX can easily meet that threshold because they're targeting almost $2 trillion, even if they kind of target $500 billion, let's say, that's still far more than, you know, many financial other tech companies in the world.

[00:07:41]Minimum average daily trading volume of 200,000 shares. And this is the threshold that I cannot possibly understand. How exactly are they going to pass this threshold? Basically means that there should be 200,000 shares traded daily. So, if you're getting to the market today, there is no history to back you up. So, yes, maybe on the first day they will be part of the there should be 200,000 shares traded, but it means that on the first day they got a fast track them into the Nasdaq.

[00:08:11]So, basically they are just prepared, so when they will announce the IPO, like an hour later or 30 minutes later into the IPO, Nasdaq will instantly get them into Nasdaq 100. That is the only possibility, and it seems a bit insane to be honest. So, they should not be bankrupt, and they should be reconstituted annually each December.

[00:08:31]Then, I don't know how they going to fulfill these demands. But anyways, let's assume for a fact that they will accept them into the Nasdaq 100 the first day, and they will make some exceptions. Now, the problem when you want to become part of the S&P 500. An S&P 500 is literally the most important index. Like, it's just every single almost 401K investor, every single almost ETF investor, the world invest in the S&P 500. So, this is the place you want to be. This is the market you want to invest in.

[00:09:00]So, if you can get into the S&P 500, it's guaranteed you could be making like you will attract billions of dollars.

[00:09:07]The first thing is that it should be a US company primarily listed in one of the major exchanges. That's not a problem. A market cap of $22.7 billion.

[00:09:15]Again, that's not a problem. We're targeting like $2 trillion.

[00:09:19]Now, at least 50% of the shares should be publicly floating. And this is where the real problem actually gets with SpaceX. Because if you look at the who are the holders of SpaceX. First of all, you have 40% belongs to Elon Musk personally. He has 80% the controlling stake, but there is difference, right?

[00:09:36]So, the stocks that he personally owns is about 40%. Then you have Google who is also an investor there and they own about 6%. And then you have all of these people who worked at SpaceX for a very long time and they own a small chunk of the company. So, that's where the vast majority of ownership comes.

[00:09:54]Here's the question. How will they manage to ensure that 50% of the stocks will be floating? Because they don't want to spend that much. Because if you are, let's say, trying to raise 75 billion dollars at almost two trillion dollar valuation, you can do the math that you're not selling half of the company. You're not even selling anything close to that. So, that raises the question, will the S&P 500 do an exception?

[00:10:17]Well, if they move away from their own standards, why wouldn't they do that for other companies? And if they do that, why would anybody else ever respect the S&P 500?

[00:10:27]Positive earnings in the most recent quarters and positive cumulative earnings over the last four quarters. To go public, of course they have to share their financial statements over the last couple of quarters. But in this case, they haven't been public. So, they have to go public, they should start sharing their financial statements every single quarter. And if they record a single year of profitability, that's when they can become part of it. How can they possibly part of it be now? I don't understand. Minimum annual dollar trading volume of $1. Okay, that's not a problem at all. And they must be public for at least 12 months. Again, if one of the requirements is for you to be already public for 12 months, and you are going an IPO today, how can we possibly make you part of the S&P 500?

[00:11:13]And that's why we already have the news that SpaceX won't get fast tracked into the S&P 500. So, we know that every single index that they thought is going to be invested in the SpaceX is not going to happen. And that instantly means that that huge demand they counted for is not happening. So, probably you can expect that even on the first day of trading, you can expect that you can expect SpaceX stock to actually collapse. Look what they say. The earliest SpaceX can be listed in the S&P 500 is mid-2027, and then only if it has four quarters of positive earnings under generally accepted accounting principles. So, first of all, SpaceX should go public. Then they have to show us that they have been profitable for the last four quarters, and if that happens, then we will accept you into the S&P 500. Now, here's the question.

[00:12:05]Will that happen on the first year after going public? Let's look at the earnings of the SpaceX. Look, in 2025, they recorded a negative loss, then in 2026 as well.

[00:12:18]And if you look at the data right now, it doesn't seem like they will record anything positive anytime soon. Like, until the end of the year in the second quarter of 2026, it was negative $4.5 billion out of the total revenue of $7.5 billion.

[00:12:34]We can see that there is a huge rise in revenue, and by 2028, they're going to rise to $28.5 billion per quarter, but even then, there is going to be a net loss of less than half a billion dollars. And that means that best case scenario, the company is going to record a full 12-month profitability like in 2029, which means that in 2029, they will be part of the S&P 500 and not anytime soon. And here's the difference that a lot of people don't understand.

[00:13:05]When you're going to the stock market right now and you're trying to buy Apple stocks, who do you think you're buying Apple stocks from? You're buying these stocks from somebody who already owns Apple stocks. So, you're buying from a real person who bought the stocks for a certain amount of money. Now, when you go to the IPO and you want to buy SpaceX stocks, you're not going to buy SpaceX stocks from somebody who bought SpaceX stocks in the past. Most likely, you are going to buy the SpaceX stocks from the people who own SpaceX when they got the shares, for example, as stock compensations. You might get them from Elon Musk himself. So, these people haven't actually paid or raised or invested in SpaceX the $2 trillion valuation. They probably owned the stocks when the valuation of SpaceX was like a couple of billions of dollars, less than $50 billion.

[00:13:53]So, you are the one who is going to overpay massively for the stocks. And these people don't care. Even if they sell you at $1 trillion valuation, they're already making thousands of returns on their investments. And you will be the person who's going to lose here because you will be the person who is going to pay peak valuation. And when you buy the stock at its peak, you know what happens next. I'm not saying that nobody should be investing in SpaceX. I will definitely be investing in SpaceX, but not now. The company should go public. We have to wait and see how the company is doing. We have to look at all the financial statements and look how low the price is going to be. And one more thing that we realized is that if the Fed will raise interest rates this year, you will see another crash in the price of SpaceX. So, wait for that right moment. Just because SpaceX IPO isn't actually a good investment right now, it doesn't mean that there are no other opportunities in the market. So, if you want to know whether the top five stocks you should be buying right now in the stock market, then check out Investing Academy. There I have posted the best stocks you can possibly buy right now.

[00:14:55]And then we have a limited number of free spots available in the Investing Academy. So, if you want to join and make sure that you get one of these free spots, then check out the first link in the description of this video.