SpaceX is worth less than half of its $1.75 trillion IPO target, Morningstar says
Morningstar analysts have expressed concerns that SpaceX is significantly overvalued ahead of its upcoming IPO. They estimate the company's value at $780 billion, which is about 48% lower than its private market valuation of $1.5 trillion. The analysts suggest that while the IPO may attract initial investor interest, better opportunities for investment may arise in the future.
- ▪SpaceX is targeting a $75 billion fundraise and a valuation of $1.75 trillion for its IPO.
- ▪Morningstar's valuation of SpaceX is $780 billion, significantly lower than its private market valuation.
- ▪The company has recorded substantial net losses, including $4.28 billion in the latest quarter.
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SpaceX is expected to start trading on the Nasdaq in just over two weeks, but Morningstar analysts have warned that Elon Musk's tech behemoth is "significantly overvalued."The hotly-anticipated debut is expected to be the largest ever initial public offering, with SpaceX reportedly targeting a $75 billion fundraise and a valuation of $1.75 trillion."We think the company has been significantly overvalued and investors will have opportunities to buy the stock at more attractive levels after the IPO," Morningstar analysts wrote in a note published Monday. The analysts see a wide range of possibilities for the potential profitability of SpaceX's xAI and find its "economic moat indeterminate." They view the unit as posing a "material threat of value destruction" to the company.
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