Here Is the Most Jarring Number Ahead of SpaceX's IPO
Key Points
SpaceX's projected valuation at IPO would make it one of the world's most valuable public companies.
With its 2025 revenue and expected valuation, SpaceX would be more expensive than every "Magnificent Seven" stock.
Investors should be cautious about investing in SpaceX right at its IPO.
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When it became clear that SpaceX was headed toward its initial public offering (IPO), most investors could reasonably expect it to be one of the largest ones in recent memory. However, few would've predicted it would become the largest IPO in stock market history.
SpaceX is set to sell 555,555,555 shares at $135 each during its IPO on June 12, raising $75 billion and starting with a valuation of around $1.77 trillion. And while beginning your public debut as the world's eighth most valuable public company (based on market caps on June 8) is quite the feat, the valuation itself isn't the most jarring number. Let's take a look at what it is.
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Retail investors will be paying a hefty price for SpaceX
Market cap and valuation by themselves don't necessarily tell you if a stock is "cheap" or "expensive," but you can get an idea of it when you compare it to a company's revenue or profit. Since SpaceX isn't profitable (it lost $4.9 billion in 2025), it's better to look at how its revenue compares to its valuation.
Last year, SpaceX made $18.7 billion in revenue. If we use that figure, its price-to-sales (P/S) ratio -- which tells you how much you're paying per $1 of a company's revenue -- would be 93.6. There's expensive, and then there's that.
For perspective, here is the current P/S ratio of some notable tech companies:
| Company | Price-to-Sales Ratio |
|---|---|
| Broadcom (NASDAQ: AVGO) | 25.5 |
| Nvidia | 20.0 |
| Micron | 18.2 |
| Taiwan Semiconductor Manufacturing | 16.7 |
| Tesla | 14.8 |
| Alphabet | 10.5 |
| Apple | 10.0 |
| Microsoft | 9.7 |
| Meta Platforms | 7.0 |
| Amazon | 3.6 |
Data source: YCharts. P/S ratios as of June 8.
SpaceX would trade at more than 3.5 times Broadcom's price, which is growing revenue 48% and reported $9.31 billion in net income in its most recent quarter (ended May 3). And even Broadcom is very expensive by most standards.
SpaceX will be trading between 4.7 and 26 times as expensive as the "Magnificent Seven" stocks. And while they may not all be perfect apples-to-apples comparisons, they show just how expensive SpaceX's stock will be.
Is it worth investing in SpaceX during its IPO?
A good company doesn't always make a good investment. Regardless of how promising a company is, if you're investing while it's trading at a high premium and priced for perfection (which is the case with SpaceX), you can limit your upside and increase the risk of a post-IPO pop sell-off.
I would steer clear of investing in SpaceX at its IPO because of the virtually inevitable volatility and risks. That doesn't mean it won't eventually be a good investment, but I'd give it time to breathe.
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Stefon Walters has positions in Apple, Microsoft, and Taiwan Semiconductor Manufacturing. The Motley Fool has positions in and recommends Alphabet, Amazon, Apple, Broadcom, Meta Platforms, Micron Technology, Microsoft, Nvidia, Taiwan Semiconductor Manufacturing, and Tesla. The Motley Fool has a disclosure policy.
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