How Big Will SpaceX Be in 5 Years? Here's What the Experts Are Saying.
Written by Ryan Vanzo for The Motley Fool -> The SpaceX (NASDAQ: SPCX) initial public offering (IPO) could break records this week. The company is reportedly targeting a $1.77 trillion valuation, raising as much as $75 billion in capital. Many investors are wondering if they sh
The SpaceX (NASDAQ: SPCX) initial public offering (IPO) could break records this week. The company is reportedly targeting a $1.77 trillion valuation, raising as much as $75 billion in capital.
Many investors are wondering if they should participate in this IPO . While there are several ways to buy into SpaceX before the IPO , most investors are better off waiting for shares to become publicly available. Before you invest, it's important to assess whether or not you actually believe SpaceX's $1.77 trillion valuation target is reasonable.
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There are many reasons to believe SpaceX could far exceed this valuation in the long term. The company has a major lead in getting payloads to space safely, consistently, and cheaply. It also boasts a profitable Starlink division that provides internet and mobile connectivity services worldwide. And, of course, SpaceX's xAI division is planning one of the largest data center buildouts in history.
To be fair, a growing number of experts are concerned that the valuation may be overly rich -- at least over the near term.
"The company has redefined the economics of spaceflight, built a dominant position in global launch, and extended connectivity to places beyond the reach of traditional infrastructure," a recent Morningstar report admits. "The valuation, however, deserves more careful scrutiny."
Morningstar analysts conclude that SpaceX's appropriate initial valuation should be somewhere closer to $780 billion -- less than half of SpaceX's internal target. "We think the company has been significantly overvalued and investors will have opportunities to buy the stock at more attractive levels after the IPO," Nicolas Owens, a Morningstar analyst, warned last week.
But let's forget about the short term for now. Five years from now, how big could SpaceX actually get? There are several ways to gauge an approximate answer. One growth catalyst in particular should dominate any discussion about SpaceX's future: AI.
