Key insights
- The author warns against investing in pre-IPO SpaceX, citing its current high Price-to-Sales (P/S) ratio of 96, significantly exceeding Tesla's peak P/S of 30 in 2021. They suggest waiting for SpaceX's P/S to drop to 25-30, implying a valuation of $468B-$561B and a share price of $36-$43, to avoid potential 'bag holding' similar to Tesla investors who experienced a two-year downturn. This perspective suggests a bearish outlook on current SpaceX IPO valuations and potential
Tesla at its peak hype and craziness in Nov 2021 had a P/S of 30 and people had to bag hold for 2 years until Dec 2023 if they didn’t average down. SpaceX is 3 times that. I would personally wait for price to sales (P/S) to go to 25 - 30. Which means 468B - 561B and a share price of $36 - $43. Instead of $135 and 1.75T and P/S of 96. If you want to buy at ipo anyways, you will be bag holding, unless you average down or SpaceX magically brings their price sales to under 30 within 2 years. Good luck!