SpaceX was on course to exceed $2 trillion in market valuation on its Nasdaq debut Friday, and it did just that, reflecting enormous investor appetite for the Elon Musk-led company and putting it on track to become the sixth-largest publicly listed company in the United States.
Shares were indicated to open at around $175 each — approximately a 30% jump from the $135 IPO price — setting the stage for a spectacular opening for what is the world’s biggest ever IPO, reports RTE.
Days of intense excitement surrounding the debut now give way to what will be one of the biggest stress tests of Wall Street’s trading infrastructure in years, with exchanges, market makers and underwriters bracing for extraordinary order volumes after the company sold $75 billion in shares.
This immediately valued it at $1.77 trillion, making it one of the largest companies in the United States, reports RTE.
Exchanges and trading firms are keen to avoid the technical difficulties that disrupted Meta’s 2012 debut.
With SpaceX widely regarded as a dress rehearsal for a new generation of mega-listings, market participants will also be watching for signals on investor appetite ahead of forthcoming IPOs for AI heavyweights Anthropic and OpenAI, reports RTE.
Shares were not expected to begin trading until the middle of the trading day, as the exchange collects buy and sell orders and underwriters delay trading until supply and demand is balanced.
“We would expect SpaceX to see an immediate pop in trading due to the hype around the deal, north of 20% perhaps,” said Samuel Kerr, global head of equity capital markets at Mergermarket. “Anything lower would actually make me nervous,” reports RTE.
SpaceX President Gwynne Shotwell and Chief Financial Officer Bret Johnsen rang the Nasdaq opening bell at the start of Wall Street trading earlier today.
The landmark listing cemented Musk’s status as the first trillionaire in history and propelled SpaceX into the ranks of the world’s most valuable companies — even though the firm posted a loss of nearly $5 billion last year and generated only a fraction of the revenue brought in by similarly valued tech giants, reports RTE.
“I gave SpaceX a 10% chance of succeeding at all,” Musk said in Texas, shortly before the opening bell.
The stock’s performance will also serve as a test for the so-called “Musk premium,” which has underpinned Tesla’s $1 trillion-plus valuation, despite coming under pressure during Musk’s prominent role in President Donald Trump’s administration, reports RTE.
World’s biggest IPO
The record-breaking IPO represents the culmination of Musk’s long-held ambitions in space and technology, and has stood out for rewriting Wall Street’s IPO playbook and drawing enormous numbers of retail investors into the market.
At $75 billion, the proceeds from the offering were more than double those of Saudi Aramco’s record-setting 2019 IPO, and the listing is set to make SpaceX the first US trillion-dollar debut and the seventh-largest US company by market capitalisation, reports RTE.
The valuation could rise further should underwriters exercise their right to sell additional shares, a decision typically made within 30 days of the offering.
Although SpaceX may have to wait for entry into the S&P 500, its expected fast-track inclusion in the Nasdaq 100 will soon make it a major holding for passive funds and ETFs tracking the index, creating fresh demand for its shares, reports RTE.
“We have to go back 100 years to get comparable entrepreneurs. He’s a visionary unlike others, and he executes extremely well,” said Joel Shulman, CEO of ERShares, which manages an ETF with exposure to SpaceX.
It will take about a month before SpaceX is added to the index under Nasdaq’s new fast-entry rules, as opposed to a typical wait of up to a year, reports RTE.
Some analysts expect SpaceX’s debut to trigger a reshuffling of investor portfolios, creating selling pressure on other technology heavyweights as funds rotate into the stock.
A $28.5 trillion market opportunity
For all the excitement surrounding the IPO, determining SpaceX’s true worth remains a challenging exercise in valuation.
SpaceX has said its market opportunity spans $28.5 trillion, a figure it described as the largest in human history, reports RTE.
With its dominant position in space — the company says it is responsible for more than four-fifths of all mass launched into orbit over the past three years — and revenues from Starlink, some investors say it has a strong foundation upon which to build.
John Belton, portfolio manager at Gabelli Funds, said the best comparable to SpaceX is Musk’s electric vehicle company Tesla, as each has an established business and “a moonshot opportunity on the other side,” reports RTE.
“For Tesla, that’s things like humanoid robotics and other future applications. For SpaceX, it’s the AI business,” he said.
The hurdles at its enormous valuation include efforts by rivals such as Jeff Bezos’ Blue Origin to accelerate the commercialisation of space and pursue government contracts in a bid to unlock new markets beyond Earth, reports RTE.
With revenue of $18.7 billion in 2025, the company’s market cap puts its price-to-revenue ratio at a lofty 94. Some analysts have already issued positive ratings on the company, while Morningstar analysts earlier this month said it is more fairly valued at around $780 billion.
“This is not a name you’re buying based on fundamentals. For me, the analogy is Amazon. This was a company that changed the way we live,” said Nancy Tengler, CEO and CIO of Laffer Tengler Investments.
“If the stock drops to $100, that’s not ideal, but it wouldn’t change our long-term view. We want to participate,” she said, reports RTE.
Shares of space companies fell on the day with Intuitive Machines, Planet Labs and Satellogic all down between 7% and 12%.
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