SpaceX’s record IPO is perfect. After the launch on the NASDAQ, there are signs of a significant premium on the issue price.
• Raised $75 billion in record IPO
• Indications indicate a significant premium on the issue price
• Starlink sustains growth despite heavy investment in Starship
The company, known, among other things, for its Starlink satellite internet service, sold around 555.6 million shares at an issue price of $135 – and thus raised $75 billion (€64.8 billion). Trading in the stock began on Friday. In the previous largest IPO, the Saudi Arabian oil company Aramco raised a good $29 billion in 2019.
SpaceX is making its debut on the stock exchange as planned with a valuation of 1.77 trillion dollars – and is immediately worth more than the Facebook group Meta. With the IPO, Musk will become the first person with a fortune of more than a trillion dollars – at least on paper, measured by the value of his SpaceX shares and shares in the electric car manufacturer Tesla, which he also runs.
Foretaste for German investors
Lang & Schwarz already set an indicative price of 183.00 euros for the SpaceX share on Thursday – a premium of 9.58 percent. Over-the-counter pre-IPO trading gives investors an initial sentiment indicator, but cannot be equated with regular stock exchange trading after the NASDAQ launch.
SpaceX was already in huge demand before its record IPO
The space company’s shares were already trading at significant premiums in unofficial, unregulated and over-the-counter trading (gray market).
Derivatives trading ahead of SpaceX’s IPO suggested a gain of between 30 and 50 percent as retail investors flock to the highly anticipated IPO. Derivatives offered by the trading house IG International, for example, suggested a market value of $2.4 trillion in Singapore, which would mean a profit of more than 35 percent compared to the issue price. Perpetual futures tied to SpaceX – contracts without an expiration date – were traded on crypto trading platform Hyperliquid at a price of around $180, a valuation of more than $2.3 trillion.
“Perpetual futures are important because they reflect leveraged market expectations in real time,” said market watcher Stephen Innes. The combination of high trading volume and high total outstanding derivatives contracts suggests that this is more than just a passing headline trade.
According to Innes, a market valuation of SpaceX at the close of the first trading day of over two trillion dollars would provide a meaningful valuation template for the next mega IPOs in the AI sector and signal to bankers that the stock market can also cope with extreme magnitudes. The ChatGPT inventor OpenAI and its rival Anthropic are in the starting blocks.
In regular trading, however, it takes some time until SpaceX’s initial price is determined. “Investors should keep in mind that U.S. IPOs typically go through an opening auction at the start of the trading day, which can last several hours,” said analyst Matt Britzman of British investment firm Hargreaves Lansdown.
SpaceX probably with a significant premium on the issue price
The shares of the space company SpaceX from Elon Musk The record IPO is likely to start with a noticeable premium on the issue price. The indications for the first price on the Nasdaq tech exchange were last at $160 on Friday afternoon. That would be a premium of almost 19 percent on the issue price of $135.
The market valuation of SpaceX on the stock exchange would be around $2.1 trillion. Previous indications had previously estimated the first price even higher at up to $175.
Billions in losses on SpaceX’s balance sheet
SpaceX’s pure business figures are in stark contrast to its stock market value – investors are more likely to pay for the hope of future success. Last year there were losses of around 4.94 billion dollars on sales of 18.67 billion dollars (a good 16 billion euros).
In the first quarter of this year, SpaceX posted a loss of $4.28 billion on sales of around $4.7 billion. One reason for the red numbers is the high costs of developing the large Starship rocket.
SpaceX invested a total of more than $15 billion in Starship. Company management expects that the rocket will be able to conduct commercial flights in the second half of the year after all tests are completed. It is intended to significantly reduce the costs of transport into space. Starship will also be used to put Starlink satellites into orbit, which will make the Internet available from space directly on smartphones.
Better numbers thanks to Starlink
Starlink is SpaceX’s central moneymaker and generated $3.26 billion in sales in the first quarter. The satellite internet service now has around 10.3 million customers in 164 countries.
In the future, artificial intelligence will be the biggest business – also through data centers in space. The idea behind it is that the sun can provide a lot of energy there. However, skeptics point to problems such as the considerable construction costs, difficult cooling despite the low temperatures in space, and radiation that can damage circuits.
Musk is in charge
With a voting share of more than 80 percent, Musk will retain full control of SpaceX even after the IPO. The basis for this is shares with more voting rights.
Unlike many other IPOs, SpaceX set the issue price of $135 in advance. Typically, companies first name a range – and then determine the price based on investor interest.
Windfall for early investors
For SpaceX’s early backers, the IPO will be a windfall. According to the financial service Bloomberg, the investment firm Founders Fund owned by Musk’s long-time companion Peter Thiel holds a stake of around three percent, which was acquired for around $600 million. The stake is worth more than $50 billion at the issue price. The venture financier Sequoia Capital I invested around $2 billion – and now hold a stake worth more than $20 billion.
Claudia Stephan, Martina Köhler, Julia Walter, finanzen.net editorial team with material from dpa-AFX
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