Gadgets & Workspaces · Story 6
SpaceX is worth less than half of its $1.75 trillion IPO target, Morningstar says
Morningstar analysts say SpaceX is worth less than half of its $1.75 trillion IPO target. They are uncertain about the profitability of its xAI unit and call its economic moat indeterminate.
The valuation gap highlights the risk for retail investors in a highly anticipated IPO. It also raises questions about the financial health of Elon Musk's private companies.
Key details
- Morningstar analysts value SpaceX at less than half of its $1.75 trillion IPO target
- Analysts see a wide range of possibilities for xAI's profitability and find its economic moat 'indeterminate'
- xAI is viewed as posing a 'material threat of value destruction' to SpaceX
- The valuation is based on a Morningstar report cited by CNBC
Discussion angles
- Many commenters express that the inflated valuation is obvious, with one saying 'water is wet'
- Some posters allege market manipulation to enrich Elon Musk, accusing the process of creating wealth for one person
- Commenters point to a chain of debt-heavy transactions: xAI bought Twitter with debt, SpaceX bought xAI with debt, and SpaceX itself carries massive debt
- Several users argue that Musk's companies are overvalued Ponzi schemes and are unprofitable despite the trillion-dollar IPO aim
Top comments
The community is broadly skeptical, calling the high valuation obvious and accusing the process of market manipulation. Commenters highlight a chain of debt-laden transactions between Musk's companies and argue they are overvalued and unprofitable.