Will The SpaceX IPO Nail The Landing?
By Chief Investment Officer Tom Kelly, CFA
I still remember watching SpaceX complete its first successful rocket landing a decade ago and being amazed. That sense of awe only grew when it later caught a Super Heavy booster with mechanical arms. SpaceX’s engineering achievements are remarkable – it is clearly an exceptional company.
The question for us is whether SpaceX will also be an attractive investment going forward.
SpaceX is preparing for its initial public offering (IPO) on June 12th, in what is anticipated to be the largest IPO in history.[1] That, however, does not automatically make the IPO an exceptional opportunity to invest. With only a small portion of shares likely to trade initially, the setup points to a first-day frenzy. Limited supply can drive a sharp pop, but once trading settles, the stock will face a steep climb to justify sky-high earnings expectations.
We expect a similar pattern in other marquee private market names expected to go public later this year, including OpenAI and Anthropic.
Great businesses aren’t necessarily great investments when scarcity, story, and valuation outrun fundamentals.
Do Some Investors Already Have Exposure To SpaceX, OpenAI, & Anthropic?
While the IPO may feel like the first chance to participate, many diversified portfolios may already have meaningful exposure, directly or indirectly. Some private equity investment funds hold SpaceX, while public companies such as Alphabet, EchoStar, Amazon, Microsoft, Nvidia, Salesforce, Zoom, and SoftBank having ownership stakes in SpaceX, OpenAI, or Anthropic.
In our view, the issue is not access to innovation. The issue is whether it makes sense to add exposure at an aggressive valuation and under constrained trading conditions.
Why Do Valuation & Liquidity Matter In A SpaceX IPO?
Based on reported valuation expectations of roughly $1.77 trillion and revenue of about $18.7 billion, SpaceX is on track to go public at roughly 95x market capitalization / trailing sales.[2] By comparison, the S&P 500 - as represented by the Vanguard S&P 500 ETF - trades at around 3.3x market capitalization / sales.[3] There is no price-to-earnings support at present, as SpaceX is currently unprofitable, which makes discipline even more important.[2]
At the same time, liquidity will likely be limited. With only about 4% of shares expected to be available at the IPO, and various lockup periods for additional shares throughout the next year, allocations within diversified stock investments may be small initially and early trading could be unusually volatile.[4]That matters because the number of shares available shapes both price discovery and index eligibility.
The MarketPlus® Investing View On The SpaceX IPO
At SJS, our MarketPlus® Investing philosophy emphasizes discipline, diversification, valuation, liquidity, and thoughtful portfolio design. We do not believe investors should chase first-day allocations or early trading simply because a company is innovative, large, scarce, or widely admired.
We and the mutual fund & ETF investment managers will evaluate exposure as pricing, valuation, float, lock-up terms, governance, and index inclusion are clearer. Until then, we believe the right posture is patience, discipline, and adherence to the MarketPlus® Investing philosophy.
Sticking to the process is not ignoring innovation. It is how investors participate without getting launched off course.
Important Disclosure Information & Sources:
[1] “SpaceX Eyeing Roughly $1.75 Trillion Valuation in IPO Next Week”. Corrie Driebusch, 02-Jun-2026, wsj.com.
[2] “Terms Revealed for SpaceX’s Unconventional $75 Billion IPO”. Becky Peterson & Corrie Driebusch, 04-Jun-2026, wsj.com.
[3] “VOO: Vanguard S&P 500 ETF”. Vanguard, 31-May-2026, vanguard.com.
[4] “SpaceX reveals its share price and record valuation: 555.6 million shares at $135 apiece, at a $1.77 trillion valuation”. Eva Roytburg, 03-Jun-2026, fortune.com.
There is no guarantee investment strategies will be successful. Past performance is no guarantee of future results. Diversification neither assures a profit nor guarantees against a loss in a declining market.
Advisory services are provided by SJS Investment Services, a registered investment advisor (RIA) with the SEC. Registration does not imply a certain level of skill or training. SJS Investment Services does not provide legal or tax advice.
Statements contained in this article that are not statements of historical fact are intended to be and are forward looking statements. Forward looking statements include expressed expectations of future events and the assumptions on which the expressed expectations are based. All forward looking statements are inherently uncertain as they are based on various expectations and assumptions concerning future events and they are subject to numerous known and unknown risks and uncertainties which could cause actual events or results to differ materially from those projected.
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