r/investing
SpaceX is trading at twice my sum-of-the-parts value
Author argues SpaceX's $2.5T valuation exceeds its $1.25T sum-of-the-parts value, questioning market irrationality.
- Sum-of-the-parts valuation for Starlink, Starship, and government contracts only justifies ~$1.25T, making $2.5T severely overvalued.
- Even generous conventional analyst valuations for segments like xAI fail to bridge the gap to the current market cap.
- Recent developments like the Cursor acquisition do not fundamentally alter the core valuation math.
I previously valued SpaceX at $1.25 trillion based on adding up the value of its businesses. (And I was generous, using conventional analyst valuations for things like xAI.) I predicted the IPO would pop anyway, and it would end around $1.9 trillion.
Now that it's at $2.5T I asked myself, was I wrong? Or is this one of the "market can stay irrational longer than you can stay solvent" situations?
So I revisited my valuation, and basically, I stand by $1.25T. I don't see anything in the last month that makes me think it's fundamentally worth much more, including the Cursor acquisition. Starlink Consumer at $380B, Starlink Enterprise at $147B, Starship at $170B, government contracts at $123B... even being very generous I cannot get these to add up to enough.
Is there a real value investing case for SpaceX? What am I missing, other than the index fund and Elon Musk pop?
You make a trillion dollar valuation on a loss making company with 20b annual revenue and you are looking for a real value investing case?
You’ve overvalued it by 4x
Stock price = real value * feels
Just wait until it hits $10T you are going to lose your mind.
Is this insider info? Are you Elon?
No I’m just someone that posts on Reddit about stocks and has been consistently right
Tell us what to buy then.
that reminds me, i need to uninstall cursor
Fact is, Musk is very good at driving up the "feels" in the u/LotsoPasta 's equation. There's a reason why Tesla is valued more than all other car companies combined.
I have given up trying to outguess him. I bought Tesla once when it seemed cheap. It went up by 2X after that. I didn't see any change in fundamentals, so I chickened out and sold. After I sold, it has gone up by 20X 😂 😂 FML, right?
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The hasn't sent up too many things into space until recently. He has certainly pioneered it, but there are many famous inventors that end up broke. Previous success does not guarantee future success.
BYD is eating Tesla's lunch everywhere but the US. His new pay package reflects that the electric car market is flatlining.
New Glenn has a similar price/kg to send something to space. If they can be close, SpaceX does not have the pricing power you think it does. They can't just raise prices 10 or 100 times without consequence.