Key Points
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SpaceX, founded by Elon Musk, went public on June 12 at an initial price of $135 per share, achieving an initial market value of $1.8 trillion, making it the largest IPO in history.
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The stock gained over 20% on its first trading day, bringing its valuation to more than $2 trillion.
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Historically, large IPOs in the U.S. have underperformed, with the average stock declining by 33% within the first year.
SpaceX’s valuation of $2.2 trillion corresponds to a trading multiple of approximately 115 times its $19.3 billion in annual sales, significantly higher than the most expensive stock in the S&P 500, which is valued at 59 times sales. Analysts predict that if SpaceX follows historical trends, a $10,000 investment today could fall to about $4,000 within a year.
Investors should be cautious, as large IPOs have generally exhibited poor performance in their initial year, raising concerns about SpaceX’s sustainable growth given its premium valuation.
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