- Rocket and satellite developer and AI platform owner SpaceX is primed to file for a US stock market listing
- Company could sell $75 billion in shares for a total valuation of $1.5 trillion
- Limited free float could prove squeezy
- Proposed listing could be the first big test of the AI boom, especially with Anthropic and OpenAI potentially coming close behind
“Before the war in the Middle East grabbed everyone’s attention, financial markets had started to grapple with whether a bubble had formed in technology and artificial intelligence stocks – thanks to their lofty valuations and equally ambitious spending plans – and the putative stock market flotation for SpaceX should therefore be an interesting test of market sentiment,” says AJ Bell investment director Russ Mould.
“The share prices of each of the Magnificent Seven, as well as fellow AI hyperscaler Oracle, have all lagged the S&P 500 index in 2026 to date and the S&P has, in turn, trailed the FTSE All-World this year. So bulls of AI and US stocks more generally will be hoping for a starry showing from the SpaceX deal, if and when it comes.
Source: LSEG Refinitiv data
“SpaceX designs, makes, and operates the partially reusable Falcon 9 space rockets and the Starlink satellite internet network, while it also owns X (the social media platform once known as Twitter) and chatbot and AI platform xAI.
“The regulatory filing to kick-start the IPO process is thought to show that SpaceX plans to sell $75 billion in stock, to give the company a $1.5 trillion stock market capitalisation. That would slingshot SpaceX into the list of the world’s 10 most valuable public companies and place it just ahead of Tesla in the pecking order.
“With rival AI developers Anthropic and OpenAI thought to be considering a stock market flotation as well, also with valuations in excess of $1 trillion, early-stage backers and potential new shareholders will be hoping for a fast start to life as a public company. Sceptics will wonder whether the SpaceX float, with plenty more to maybe follow, will prove to be a classic sign of a market top.
“There is an old market saying that bull markets end when the money runs out, and there are plenty of historic examples where a deluge of IPOs and new stock market entrants, and then subsequent secondary offerings, meant sellers eventually swamped buyers. The bursting of the tech, media, and telecoms bubble in 2000 is one instance and the surge in new listings in 2020 and 2021 helped to put the brakes on the S&P 500, at least temporarily, in 2022.
Source: StockAnalysis. *2026 as of 26 March.
“It was not for nothing that Warren Buffett once tartly described the process thus: ‘First come the innovators, who see opportunities that others don’t. Then come the imitators, who copy what the innovators have done. And then come the idiots, whose avarice undoes the very innovations they are trying to use to get rich.’
“So far, though, there have been no blockbuster IPOs during the AI boom. Space X, Anthropic and OpenAI could be about to change that, the war in the Middle East and market conditions permitting, and this is why these deals could be a key test of sentiment for the tech sector and US equities more generally, especially given their supposed price tags and their first-mover status as innovators.
“When it comes to the SpaceX IPO specifically, and the research necessary to decide whether the reported $75 billion offering and total $1.5 trillion price tag for the company offer the right balance between downside protection and upside potential, investors can apply the helpful four-point checklist provided by Warren Buffett’s long-time business partner Charlie Munger in his timeless piece, ‘Poor Charlie’s Almanack’:
- Do I understand the business?
- Does the business have intrinsic value, and a strong competitive position within its industry that it can protect and develop?
- Does management have integrity and are management’s interests carefully and clearly aligned with those of shareholders?
- Does the company come at a fair price?
“If the answer is ‘no’ to any of these four questions, then the investor may need to resist the fear of missing out, or FOMO, and walk away, hard as that can be.
“The last point, valuation, is the most important of those four questions in the long term, regardless of what happens in early trading after a flotation. It was not for nothing that Peter Lynch, the fabulously successful manager of Fidelity’s Magellan Fund, said that IPO should actually stand for ‘It’s Probably Overpriced.’
“That may not worry some. The proposed tiny free float of 5% could make for a fearsome share price squeeze if there is plenty of interest in the stock, and SpaceX’s founder and leading shareholder is Elon Musk, who still has a mighty fan club, as evidenced by the valuation still afforded to investors by Tesla.
Source: LSEG Refinitiv data
“Tesla is still the 10th largest company in the world by stock market capitalisation, even though car volume deliveries and the company’s after-tax profits fell in each of 2024 and 2025.
“Tesla’s shares are no higher than they were in late 2021, but Mr Musk is clearly doing a good job of persuading investors that Tesla’s future is not in making cars but in robotaxis and Optimus robots, even though these revenue streams are nascent. Its $1.4 trillion stock market capitalisation compares to analysts’ consensus net profit forecasts for 2026 of $5 billion, so in effect shareholders are valuing every dollar of Tesla’s earnings at $300.”
