SpaceX may be the biggest IPO ever, but Morningstar says it is overvalued by half and the smart investors will wait out the hype and buy later
SpaceX is preparing for a massive IPO with a projected valuation of $1.75 trillion, but Morningstar analyst Nicholas Owens believes the company is overvalued by more than half, estimating its true worth at $780 billion. Despite its strong launch and Starlink businesses, SpaceX faces challenges including significant AI-related expenditures and unproven longshot projects, contributing to a net loss of $4.95 billion last year. Owens suggests that patient investors may find better opportunities to buy shares after the initial hype, as existing shareholders will have staggered opportunities to sell their stakes starting shortly after the IPO. AI
IMPACT SpaceX's significant AI expenditures are noted as a factor in its valuation and profitability, highlighting AI's growing role in even non-traditional tech companies.