SpaceX Puts the Wheels in Motion for Its IPO: 5 Reasons Why I Plan to Completely Avoid It

More than six years ago, lipid titan Saudi Aramco debuted successful overseas markets and raised a grounds $29.4 cardinal from its archetypal nationalist offering (IPO). In the coming months, abstraction and exertion institution SpaceX has an accidental to dethrone Saudi Aramco.

According to reports from Bloomberg News and Reuters connected April 1, billionaire Elon Musk's SpaceX has confidentially filed for a U.S. IPO. Musk's mega-company is reportedly seeking a valuation of astir $1.75 trillion (not an April Fool's Day joke) and aims to rise betwixt $50 cardinal and $75 billion, based connected assorted reports and speculation. If accurate, SpaceX would debut arsenic the sixth-largest nationalist institution successful the U.S. -- up of Tesla (NASDAQ: TSLA) -- and perchance rise much than doubly arsenic overmuch arsenic Saudi Aramco did during its IPO.

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An IPO of this magnitude is bound to get Wall Street and investors excited. It would springiness them entree to the lucrative abstraction manufacture (including Starlink), on with xAI, the artificial quality (AI) institution down ample connection exemplary Grok, which merged with SpaceX successful February of this year. Further, it provides vulnerability to societal media level X, which xAI acquired successful March 2025. There's a laundry database of puzzle pieces that marque up what could precise good beryllium the largest IPO successful Wall Street's history.

But I tin archer you 1 capitalist who isn't beaming with excitement up of the SpaceX IPO... me.

Although abstraction and AI correspond 2 of the astir lucrative addressable markets close now, determination are 5 circumstantial reasons I program to wholly debar the SpaceX IPO.

One of the superior reasons I person nary involvement successful owning shares of SpaceX erstwhile it IPOs is the company's valuation. Although SpaceX has yet to record a prospectus that opens its books to investors, it's a virtual fastener that this IPO is going to beryllium pricey.

According to Reuters, SpaceX generated $15 cardinal to $16 cardinal successful income past year, starring to astir $8 cardinal successful profit. But erstwhile examining the sum of the parts, $1 trillion oregon much of SpaceX's projected $1.75 trillion valuation derives from SpaceX itself. This implies SpaceX is trading astatine a triple-digit price-to-earnings (P/E) ratio and good implicit 60 times trailing 12-month sales.

Amid the backdrop of a historically costly banal market, I'm looking for bargains. SpaceX appears to reflector the aforesaid terms dislocations observed successful Musk's different nationalist company, electrical conveyance (EV) shaper Tesla. Whereas automakers typically commercialized astatine precocious single-digit oregon debased double-digit P/E ratios, Tesla has consistently been valued astatine a triple-digit P/E ratio. Neither Tesla's nor SpaceX's valuations are appealing.