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Everybody is upset about the rule change, but to be honest, they would’ve just ended up in the same position a few months later. Elon has kept Tesla’s market ca
by mattmaroon 3mo ago
Everybody is upset about the rule change, but to be honest, they would’ve just ended up in the same position a few months later. Elon has kept Tesla’s market cap at 5-10x what any reasonable investor would think it should be for the better part of a decade. It’s not like SpaceX is going to tank in the next 3 months and they’ll be left holding the bag. It’s not like it wasn’t going to end up in every index in a year.
And to be clear, I’m not saying it’s a good thing. I just don’t think it matters so much.
- Retric 3mo agoWithout rapid purchasing by indexes SpaceX’s stock would likely to tank as ever more people would be able to sell over the first year. It’s a 24 year old company with a current high flying stock price based on very questionable numbers.
- pclmulqdq 3mo agoWe all said that about Tesla for years, and a lot of people got burned on the trade. This time may be different, but it also may not be.
- Retric 3mo agoTesla’s numbers looked vastly more reasonable. “In 2025, SpaceX generated $18.7 billion in revenue, with its Starlink satellite internet service accounting for $11.39 billion, or 61% of total sales.” Tesla had higher revenue number in at the start of 2019, when it had a market cap of ~0.06 trillion. Further Tesla was highly volatile in 2021 despite huge earnings growth with some people bank when it fell from 1.2T to 0.34T before recovering.
- pclmulqdq 3mo agoYes, Tesla was ridiculous at the time, but Tesla’s valuation at the time is normal for tech companies these days. However, the main comparison, which Elon has been trying desperately to escape, is traditional automakers. If you compare how out-of-line Tesla’s PE and PS ratios are against Toyota and other car makers, it’s about the same ratio as SpaceX to tech companies today.
- mattmaroon 3mo agoTesla’s P/E ratio is currently 365. They have less than 1% market share, and declining, weak profits, products that seem to be suffering from weak updates and brand harm due to Elon’s politics, and competitors outpacing them from all sides. Toyota’s P/E is under ten. They’ll make more money selling cars this quarter than TSLA will in ten years. TSLA prices have never been within an order of magnitude of reasonable. They’ve been publicly traded for so long that some of the people legally driving them weren’t born when they IPOed. They’re not a startup and haven’t been in a while.
- Retric 3mo agoI agree Tesla’s stock is horribly overvalued, it’s the poster child for the market can remain irrational longer than you can remain solvent. My point is as a benchmark it still makes SpaceX look like a bad investment.
- mattmaroon 3mo agoRight and my point is that whether or not it’s a bad investment makes absolutely no difference to the people who own the shares because the price is divorced from that. SpaceX shares only have to stay irrational for six months for this rule change to have had no effect.
- deleted 3mo ago[deleted]
- Retric 3mo agoOk that seems like a reasonable argument, but it’s got a glaring hole. The reason for these rules is lockup periods. There’s presumably many people really want to sell significant SpaceX stock at the current price who can’t yet. Effectively August 2026 is going to add more stock to the market and that’s going to continue for a while. Such post IPO volatility is the justification for indexes to wait, and honestly it’s a very good argument IMO.
- rayiner 3mo agoI also remember lots of people saying Uber wasn’t a $100B company.
- nullstyle 3mo agoWith several large bets on the table with starship that have yet to play out. Remember mars by 2024? I think that was around the time they started accepting deposits on tesla semi.
- saturn8601 3mo agoThey shipped the Semi though. Yes the situation is bad but its not vaporware. Musk had to scam the markets to survive in late 2017/2018
- shigawire 3mo agoThe problem is the stock is not valued based on the space part. It's sky-high valuation is based on absurd projected AI revenues.
- nullstyle 3mo agoWe’ll have to agree to disagree on this one; anytime someone has to scam the markets to survive it’s my opinion they deserve jail and ruination, not a harem.
- Panzer04 3mo agoDepends, they've gone to pains to ensure the indexes will buy as share lockups end. It's dodgy no matter how you look at. The one saving grace is s&p isnt changing anything, and they were by far the biggest index.
- sidibe 3mo agoThe whole IPO was designed to be like a short squeeze where index funds have to buy soon but there's not enough shares. For the little float that's available they are weighting it significantly more than they should by previous rules. They need to have tens of billions worth of what was 70 billion by next week, and retail investors who got in on the IPO were told by their brokers if they sell early on they will not get to participate in future IPOs. There were not enough shares actually trading for the index funds to fulfill their requirements that's why the price keeps going up
- downrightmike 3mo agoChina enters the chat https://spacenews.com/china-conducts-4-launches-in-3-days-but-silence-follows-kuaizhou-11-launch/ https://spacenews.com/china-conducts-4-launches-in-3-days-bu...
- ribosometronome 3mo agoMoving to have 401ks investing in it when 5% of the stock is publicly available versus 30-40%+ that would have been available on the previous timelines seems like it could have pretty dramatic effects on its price.
- loeg 3mo agoThe relevant indices (S&P500, Vanguard) buy in proportion to available float -- i.e., its market cap is weighted by 5%. Only Nasdaq 100 ignores float, stupidly, but almost no money, especially 401(k) money, is in that.
- nrmitchi 3mo agoThis may be true (I'm sure it is, but I haven't verified) but the large majority of people do not know this, which is why hearing "my retirement account is going to be forced to by a bunch of spacex at a $2.5T valuation" makes them.... uneasy.
- mschuster91 3mo agoOh there are ETFs that track Nasdaq 100.
- keernan 3mo agoMusk tried mightily to get S&P to change their 12 month rule to 15 days but they refused. Nasdaq, however, caved to Musk and agreed to change the rules of its Index - from a 12 months wait to 15 days - in exchange for Musk agreeing to list SpaceX on Nasdaq's exchange. There are ETFs that were issued tied to the Nasdaq 100 which are therefore legally bound to buy SpaceX. But the biggest immorality is the SEC allowing Musk's attempt to manipulate the market by: 1. Setting an IPO price for SpaceX (which absorbed xAi and its money guzzling losses) at unsustainable, incredibly inflated prices; and then 2. Putting incredible pressure on SP500 and other index makers to change their rules to force the purchase of SpaceX at those sky high prices (in an IPO, company gets to set the IPO price). It's legal. At least in the eyes of the SEC which, of course, is an institution that is controlled by the wealthiest who control the markets, so of course it's legal. But it is outrageous market manipulation that is fraudulent in its intent to enrich the wealthiest man on earth at the expense of ever wage earner putting her money into Index Funds. Thank goodness the S&P and CRSP refused to change their rules. Otherwise the shifting of risk from Musk onto the shoulders of every working American would have been complete.
- HWR_14 3mo agoThey probably won't be on the S&P for years, because of profitability requirements.
- redox99 3mo agoIf they can keep google and anthropic deals, they're already profitable.
- stackskipton 3mo agoThat's huge IF, both of them have 90 day exit clause, and it's not like it's a long-term business. Those deals are doable because xAI failed and SpaceX has a bunch of spare compute lying around they can rent out. However, SpaceX doesn't make the hardware or software so moat is nonexistent. If compute capacity increases or AI demand decreases, Google/Anthropic will likely skip SpaceX and just buy their own hardware in their own datacenters or go back to their own datacenters.
- redox99 3mo agoI think anthropic needs that compute. They'll probably rent it as long as they can. They aren't really in the datacenter business. Google yes, I think they'll stop at some point.
- HWR_14 3mo agoThere is no way that Elon Musk wants to be leasing out compute. He'd rather be using that compute to power Grok.
- asveikau 3mo agoI got a good investment vehicle for you. How would you like to purchase shares in the Brooklyn bridge? You could see returns in the form of tolls.
- mschuster91 3mo ago> It’s not like SpaceX is going to tank in the next 3 months and they’ll be left holding the bag. A stock's value can disappear in a matter of days to a degree it leads to a complete collapse. It has happened before, see Enron or Wirecard. > It’s not like it wasn’t going to end up in every index in a year. Sure, but it's still not wise to let unripe stocks into most American and RoW retirement funds. There's a reason why many complex software projects keep some sort of "staging" tree, and the stock markets should do so as well.
- wolvoleo 3mo agoBubbles always blow. Maybe not in 3 months but eventually someone will figure that those trillions can't possibly be made back ever again. And then the fall down is hard.
- deleted 3mo ago[deleted]
- cm2187 3mo agoPlus if AI is indeed a bubble, investors are already up to the neck in it. Think of all the key stocks of the S&P and Nasdaq that are lifted by AI: nvidia, microsoft, amazon, oracle, micron, intel, amd, etc. And add their lenders and the whole datacenter supply chain.