SpaceX sets record with $1.78 trillion IPO amid valuation debates
SpaceX is poised to launch the largest initial public offering in history on Friday, with shares priced at $135 each, aiming to raise $75 billion and valuing the company at approximately $1.78 trillion Source: AP News. The offering is oversubscribed by three to four times, reflecting strong investor demand Source: The Guardian. However, the valuation has drawn skepticism: Morningstar calculates a fair value of just $63 per share, calling the price 'extremely speculative' Source: The Guardian. Notably, CEO Elon Musk will retain an estimated 80-85% of voting power through special-class shares, a governance structure that some analysts see as risky Source: CNBC. Senator Elizabeth Warren has urged the SEC to delay the IPO, citing 'significant risks to ordinary investors' and potential inaccuracies in valuation Source: Gizmodo. Environmental concerns also emerged: community groups near xAI data centers in Memphis have raised alarms about pollution from natural gas turbines Source: Wired. Meanwhile, Wall Street firms have initiated coverage with price targets ranging from $165 to $190 Source: CNBC. The IPO will create thousands of millionaires among employees and could make Musk the world's first trillionaire Source: Fox Business. Yet complexities in multi-layer special purpose vehicles (SPVs) mean some investors may not know their exact holdings for months Source: TechCrunch.
Sources
7 quotes“The IPO will create more than 4,000 new millionaires among current and former employees of the 24-year-old space giant.”
“Assuming the IPO goes off without a hitch, it will rank as the largest ever. It also could make Musk, a major SpaceX owner and already the world's richest man, the first trillionaire.”
“Morningstar has calculated that SpaceX is worth only $63 a share – well below the anticipated IPO price of $135 – and warns there is 'a major disconnect between market expectations and underlying fundamentals.'”
“Musk's insistence that he will retain an estimated 80-85% of SpaceX voting rights – something that has often deterred investors weighing stocks.”
“The community hosting xAI data centers already in operation are demanding accountability from the company’s use of polluting gas turbines.”
“Sen. Elizabeth Warren ... asked the SEC to delay its IPO, citing potential inaccuracies in the company’s valuation and the unusual governance structure.”
“SpaceX represents an unprecedented case of an IPO with multiple layers of these vehicles. ... backers in lower-tier vehicles might find they own fewer shares than they think.”