SpaceX plans an IPO expected to raise tens of billions of dollars, with investors seeking large first-day gains from underpriced allocations. The projected valuation of about $1.75 trillion is presented as exceptionally high compared with other post-offering figures. A contrarian view argues that the proceeds will primarily pay down debt and fund an increasingly costly AI race rather than build profits. It also points to strong competition and pricing pressure from major technology and cloud players. The critique highlights weaknesses in corporate governance, noting that IPO investors are expected to have little or no influence over company decisions, leaving control concentrated with Elon Musk.
"SpaceX is really skewering investors by raising tens of billions that instead of building profits will going to paying down debt, and "fund an increasingly costly AI race" that SpaceX claims it will totally dominate while in fact, it will encounter powerful competition, and intense pricing pressure, from the likes of Amazon, Google and Microsoft."
"Trainer brands SpaceX projected valuation of $1.75 trillion market cap, biggest by far for any post-offering number of all-time, as "truly out of this world," and instructs folks and fund to stay away from an investment that the basic math stamps as beyond lousy."
"Trainer argues correctly that the investors who are expected to buy $80 billion in SpaceX shares in the IPO will get exert zero influence over how the enterprise is run. Instead, Elon Musk will hold all the power. The rules are so one-sided that a group of America's largest pension funds, including CalPERS, and those headed by the Controllers of both New York State and City, filed a lengthy letter objecting to half-a"
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