EspaceX flew away in his Nasdaq debut on Friday, pushing its value past $2 trillion as investors jumped at the chance to get a piece of Elon MuskThe sprawling empire spans rockets, internet services and AI after a record IPO.
The launch went smoother than many observers expected, with trading beginning late Friday morning, oscillating for most of the session between gains of 15% and 30% above Thursday’s prices, with little volatility. Shares ended the day at around $161 per share, up 19%, making SpaceX the sixth-largest U.S. company, although the final settlement price has not yet been determined.
THE trading, which exceeded 500 million shares, or approximately $80 billion in volumecapped a period fraught with concerns about the stock market’s ability to handle the launch, particularly after a recent swoon in tech stocks that sparked concerns about stratospheric gains in AI-related names.
With mega-listings from AI heavyweights Anthropic and OpenAI waiting in the wings, market watchers feared that a flood of new IPOs could hurt market performance after a long period of relative dearth of offerings. But investors of all stripes, from large institutions to retail Musk fans, ended the day in euphoria.
“SpaceX is not only a record in terms of money raised during a stock market debutbut it also left other big names for the dust. With the starting valuation already at $2 trillion, adding that much value in one click is impressive,” said Dan Coatsworth, Head of Markets at AJ Bell.
Retail investors received about 20% of the allocation, far more than in a typical IPO, with some even celebrating being awarded a share.
The historic listing cements Musk’s status as history’s first billionaire, even though the company posted a loss of nearly $5 billion last year and generated only a fraction of the revenue generated by similarly valued tech giants.
SpaceX executives, including Chairman Gwynne Shotwell and Chief Financial Officer Bret Johnsen, celebrated “at the Nasdaq Market site in New York’s Times Square after ringing the opening bell on Friday.” Musk held a separate event for Texas employees.
THE LARGEST INTRODUCTION IN THE WORLD
The IPO is the culmination of Elon Musk’s long-standing ambitions in space and technology, and has distinguished itself by rewriting Wall Street’s IPO playbook and attracting legions of retail investors to the market.
At $75 billion, the transaction’s proceeds were more than double those of Saudi Aramco’s record 2019 IPO.
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The valuation could rise further if the underwriters exercise their right to sell additional shares, a decision typically made within 30 days of the offering.
“Seeing the company I joined when it was just a few sketches on paper become this valuable is almost surreal,” said Tom Mueller, a founding SpaceX employee who spent 18 years at the company and is now CEO of Impulse Space, a spacecraft startup. As a shareholder, he said it was “almost surreal” to witness SpaceX’s IPO.
Although SpaceX may have to wait for its entry into the S&P 500, its accelerated inclusion in the Nasdaq 100 will soon make it a major holding for passive funds and ETFs that track the index, creating a new source of demand for its shares.
“You have to go back 100 years to find comparable entrepreneurs. He’s a visionary like no other, and he’s doing extremely well,” said Joel Shulman, CEO of ERShares, which runs an ETF exposed to SpaceX.
It will take about a month before it is added to that index under Nasdaq’s new rapid entry rules, as opposed to a typical wait of up to a year.
Some analysts expect SpaceX’s debut to trigger a reshuffling of investors’ portfolios, creating selling pressure on other tech heavyweights as funds flow into the stock. Shares of other space and satellite companies fell sharply on Friday, with Planet Labs down 8% and EchoStar down 14%.
A $28.5 BILLION MARKET OPPORTUNITY
For all the excitement surrounding the IPO, determining SpaceX’s true value remains a difficult valuation exercise.
SpaceX said its market opportunity was $28.5 trillion, a figure it called the largest in human history. Building on its leading position in the space sector – the company claims its activity is responsible for more than four-fifths of the mass put into orbit over the last three years – and its revenues from Star linksome investors said it had a solid foundation to build on.
With 2025 revenue of $18.7 billion, the company’s market cap puts its price-to-revenue ratio at around 110, well above other large-cap stocks. Some analysts have already issued positive ratings on the company. Morningstar analysts said this month that it was more aptly valued at around $780 billion, and CFRA began coverage Friday with a sell rating.
“It’s not a name you buy based on fundamentals. For me, the analogy is Amazon. It’s a company that has changed the way we live,” said Nancy Tengler, CEO and CIO of Laffer Tengler Investments. “If the stock drops to $100, it’s not ideal, but it wouldn’t change our long-term view. We want to participate.”
