SpaceX at $2 Trillion Is Way Too Expensive. Here's What I'm Buying Instead
Summary
Couch Investor analyzes the potential $1.75 to $2 trillion valuation of SpaceX as it prepares to go public. His main thesis is that while SpaceX is a revolutionary company with high demand, its current fundamentals—specifically $11.38 billion in connectivity revenue and a massive AI capex—do not justify a $2 trillion price tag. He highlights a specific deal with Anthropic worth $1.25 billion per month as a growth driver but remains skeptical of the overall IPO pricing.
His market outlook is cautious regarding IPOs, suggesting they often mark a market top and typically face a significant correction after the 90-day lockup period. He compares SpaceX's valuation to 'Big Tech' and 'Mid-Cap' companies to demonstrate the premium being asked. Couch Investor notes that for the price of one SpaceX, an investor could own multiple high-performing companies that generate hundreds of billions in revenue and net income.
Mentioned Stocks
Reasoning: Couch Investor already owns Rocket Lab. While it is expensive, it is much smaller (27 times smaller revenue than SpaceX) and he expects the stock to rise if SpaceX's IPO generates positive sentiment for the sector.
Reasoning: Couch Investor highlights Meta as a much better value proposition, trading at a $1.5 trillion valuation (less than SpaceX's target) while generating $70.5 billion in net income.
Reasoning: At a $3.1 trillion market cap, Microsoft generates $125 billion in net income, which Couch Investor argues is a significantly better deal than paying $2 trillion for SpaceX's current financials.
Reasoning: Couch Investor believes the $2 trillion valuation is a massive premium for a company with no net income and $11 billion in core revenue. He expects the stock to go down significantly after the 90-day lockup period and prefers to wait for a 'correct price'.
Reasoning: Couch Investor describes Mercado Libre as one of his favorite companies. He argues that the market cap of ~$84 billion means you could buy 20 of these companies for the price of one SpaceX, providing much higher aggregate revenue and profit.