Key insights
- SpaceX's IPO saw a significant first-day gain, but the article argues this is misleading due to a very small float (4%) and forced buying by index funds tracking MSCI. The true valuation and business prospects (Starlink, Orbital AI) will not be clear until November when the float increases and index fund impact lessens. The current price is driven by constrained supply and mechanical demand, not fundamental value, making it a poor indicator of future performance.
Everyone is talking about the 19% day one gain but what actually caused it and why it tells you almost nothing about where this stock is going.
spacex ipo'd with only a 4% float and out of a $2 trillion company only 4% of shares are actually tradeable right now meaning the $161 closing price was set by an extraordinarily thin slice of the total company and when supply is that constrained and demand is that enormous, price discovery is almost meaningless because you could drive SPCX to $300 or $80 on this float and neither number would tell you much about what the company is actually worth.
it gets structurally interesting as MSCI announced on June 9 that spcx would be eligible for early inclusion in large IPOs, with index funds starting to add it from June 13 which means rn, every passive fund tracking msci indices is being forced to buy spcx at whatever the market price is. They have no choice and dont care if it's $161 or $180 as the mandate says buy
So what are you actually buying at $161? u are buying one of three things
The starlink thesis as starlink generated $11.4B in 2025 revenue with a 63% ebitda margin and is the only part of the business making real money. If you believe satellite internet dominance justifies the valuation, you are a buyer.
or orbital thesis ,spacex wrote in its sec filing we believe orbital AI compute is an incredibly difficult technical challenge that only we can solve at scale in the near term. If you believe that, you are buying the most ambitious infrastructure bet in corporate history.
The greater fool thesis as 4% float, forced index buying, no earnings until nov and retail FOMO.( Price goes up because price is going up)
to be clear guuys i m just telling you the next 90 days of spcx price action will tell you almost nothing about which one is correct. The float is too thin and the index flows are too mechanical so the first real test isn't until November.
European investors can access it on bitpanda too with fractional shares rn whether thats a gift or a trap depends entirely on which thesis you believe.
Analyst targets range from $63 to $227,a $164 gap between the bear and bull case on a stock that's been public for 48 hours which alone telling you everything about how little anyone actually knows.
the next 90 days are going to be genuinely fascinating to watch