SpaceX's phantom valuation faces lockup pressure
SpaceX's multi-trillion-dollar paper valuation is a function of extreme share scarcity that is highly vulnerable to downward pressure as lockups expire.
The argument
The hosts argued that because only 3% of SpaceX's shares were floated in the IPO, the current market cap is a 'phantom' figure. They expect the stock to trade significantly lower in a year as more shares unlock and index providers apply strict float-adjusted caps.
The thesis, stress-tested
✓ What validates it
- ✓SpaceX stock price declines significantly upon the first major lockup expiration date
- ✓Index providers implement strict caps on SpaceX's index weight based on free float
▸ Risks discussed
- ▸Continued retail and ETF demand could sustain the high valuation despite unlocks
- ▸Aggressive long-term revenue targets could fuel further speculative buying
Hear it yourself
"And so it was a very successful IPO. I think as most people suspected, most people did not think this was going to face plant given all that we were hearing about the oversubscription, all that sort of stuff, and it didn't face plant. In fact, it did the opposite of face plant. It is now the vet the the market cap of the company is now $2,640,000,000,000, and I don't know. It's probably gonna pass Amazon tomorrow. It is about knocking on twice as big as Meta. It's bigger than Taiwan semi. What are your thoughts, Josh? Well, hang on."
06:30