SpaceX Valuation Rockets to New Record High. Here Is How to Invest in the Booming Aerospace Industry
SpaceX is reported to offer insider shares at $112 apiece in an upcoming tender offer, propelling the valuation of Elon Musk's space exploration and satellite company to nearly $210 billion, according to Bloomberg.
The tender offer, which allows employees and insiders like investors to sell shares, is priced higher than the $200 billion valuation discussed last month due to strong investor demand. Currently, SpaceX's valuation rivals that of some of the world's largest publicly traded companies. While terms aren’t finalized, the size of the tender offer might fluctuate based on the interest from both insider sellers and buyers.
Recent Test Launch Successes
SpaceX's recent achievements have further bolstered investor confidence. The company recently completed the fourth test flight of its Starship, the largest rocket ever built. Starship, along with the Super Heavy rocket, stands at 396 feet tall, surpassing the height of NASA's Saturn V rocket and the Statue of Liberty. This powerful spacecraft is designed to return humans to the moon as part of NASA's Artemis program and for future Mars exploration missions.
Moreover, SpaceX has maintained a high launch tempo, initiating the year by deploying its first Starlink direct-to-cell satellites into orbit. Last year, the company completed over 90 launches and is targeting 12 launches per month in 2024. Notable recent missions include the launch of the National Oceanic and Atmospheric Administration's GOES-U satellite atop a Falcon Heavy rocket and the deployment of 23 Starlink satellites, marking a milestone in reusable rocket technology.
Why SpaceX's Valuation is Increasing
The surge in SpaceX's valuation can be attributed to several key factors. Fortuna Investments CEO Justus Parmar highlights the rapid expansion of the Starlink satellite-internet constellation, which is transitioning from a regional to a global network, driven by an international push from Musk. With billions of potential new customers and initiatives like smaller mobile satellites, Starlink is poised to become a major revenue driver.
Additionally, SpaceX's Starship spacecraft and launch rocket promise significant advancements. Once fully operational, Starship will enable more frequent and larger payload deliveries to space, factors not yet fully reflected in the current valuation. Parmar suggests that with $9 billion in revenue last year and the growth potential of Starlink and Starship, SpaceX could eventually reach a valuation of $1 trillion to $2 trillion.
The company is growing increasingly valuable as its revenues and profits soar. That likely has many retail investors wondering when they'll get their chance to invest in the company. Here's a look at what to consider if that opportunity ever arises.
For investors looking to capitalize on the aerospace boom, several stocks present viable options, according to Matthew DiLallo of The Motley Fool and Kiel Porter of Bloomberg.
Investors can also gain indirect exposure to SpaceX through $Destiny Tech100(DXYZ.US$, a publicly traded closed-end fund focused on pre-public companies. SpaceX and OpenAI constitute almost two-fifths of its holdings. Destiny Tech100, trading like a stock, allows for easier buying and selling but comes with high volatility and a significant premium to its underlying assets. Despite its rocky start, with a 34% loss on U.S. investments as of December, it remains a unique avenue for accessing shares of high-profile private companies.
Source: Bloomberg, Motley Fool, MarketWatch
Disclaimer: Moomoo Technologies Inc. is providing this content for information and educational use only.
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