SpaceX Lost $2 Billion in the First Half of 2026. Micron Made $28 Billion in Profits in Its Latest Quarter. But the Better Stock Pick Isn't as Obvious as Those Numbers Suggest.

On the surface, there appears to be no comparison between Space Exploration Technologies (NASDAQ: SPCX) and Micron Technology (NASDAQ: MU). One is a cash-burning furnace. The other is a cash-printing machine.

Their latest earnings results underscore just how different the two companies are. SpaceX posted a net loss of $541 million in the second quarter and over $2 billion in the first half of 2026. Micron delivered a $28.2 billion profit in its fiscal 2026 third quarter.

It might seem that Micron would be the hands-down winner between the two. But the better stock pick isn't as obvious as the numbers suggest.

Image source: Getty Images.

Stark valuation differences

Micron is clearly blowing SpaceX out of the water in terms of profitability. However, investors have given SpaceX a market cap of $1.4 trillion, while Micron's market cap is a little over $1 trillion.

Keep in mind, too, that those market caps are closer now than they were in the immediate aftermath of SpaceX's historically large initial public offering (IPO). SpaceX stock is down almost 30% since its IPO, while Micron's shares have more than tripled year to date.

Even after its sharp decline, SpaceX trades at an astronomical (no pun intended) 73.4 times trailing 12-month sales. Meanwhile, Micron looks dirt cheap despite racking up a huge gain this year, with a forward earnings multiple of only 5.3.

Does SpaceX's growth trajectory justify the stark valuation gap? Nope. The company's revenue jumped 92% year over year in Q2 to $7.8 billion. However, Micron's revenue increased nearly 3.5x year over year and 74% quarter over quarter in its fiscal Q3 to $41.5 billion.

Looking beyond the numbers

I think, though, that investors need to look beyond just financial numbers and current valuations when evaluating these two stocks. Understanding why the market values SpaceX and Micron so differently is important.

For one thing, SpaceX's losses don't point to a failing business. The company's connectivity segment (which centers on its Starlink satellite internet service unit) is profitable. Its heavy investments in artificial intelligence (AI) infrastructure are dragging down the bottom line, but those investments could pay off handsomely over time.

Starlink could become an even bigger winner for SpaceX as it seeks to disrupt telecom giants such as AT&T (NYSE: T) and Verizon (NYSE: VZ). SpaceX has an even bigger opportunity if it can fulfill founder Elon Musk's vision of hosting AI applications in space and beaming the results back to Earth cost-effectively.

There's also a reason why Micron's tremendous success hasn't translated to a higher valuation. Investors know that Micron is a cyclical stock that flourishes when demand exceeds supply for memory and flounders when supply exceeds demand. While the company is currently in a strong up cycle, the fear among many investors is that a slowdown in AI data center construction could bring the good times to an abrupt end.

Which is the better stock to buy?

Interestingly, Wall Street is more bullish on SpaceX than on Micron in the near term. The average 12-month price target for SpaceX reflects potential upside of over 90%, compared with around 65% for Micron.

I think, though, that Micron is the better stock to buy for investors focused on the next two or three years. The supply demand imbalance for memory isn't likely to be addressed anytime soon, in my view. I'm also leery of buying SpaceX shares, with more rounds of lockups expiring and insiders able to sell large blocks of shares.

However, over the longer term, the choice between these two growth stocks is more difficult. SpaceX seems to have more optionality (multiple ways to grow) than Micron. I expect the company will eventually be highly profitable. It wouldn't surprise me at all if SpaceX is a bigger winner than Micron over the next 10 to 20 years.

That said, though, the adage that "a bird in the hand is worth two in the bush" seems applicable in this case. If I had to buy only one of these stocks, it would be Micron. The memory maker's risk-reward proposition is more favorable than SpaceX's -- at least for now.

Keith Speights has positions in Verizon Communications. The Motley Fool has positions in and recommends Micron Technology. The Motley Fool recommends Verizon Communications. The Motley Fool has a disclosure policy.