Cathie Wood Calls SpaceX a "Deep-Value Opportunity" at Its IPO Price. Here's the Math She's Using.

When Space Exploration Technologies (NASDAQ: SPCX) went public in June, it was at a market cap of $1.75 trillion, immediately making it one of the 10 largest public companies in the world. The common read was that it was overvalued, with Morningstar valuing it at $780 billion.

Ark Invest CEO Cathie Wood disagreed. She has invested heavily in SpaceX, and in a Sept. 16 post on X, she argued that the space company could be a deep-value opportunity at its IPO price.

Image source: The Motley Fool.

The math behind Cathie Wood's valuation

Wood and Ark analyst Sam Korus have provided calculations showing why SpaceX is a deep value, based on Starlink's revenue potential. As of 2025, Starlink generated about $19 million in annual revenue per terabit per second (Tbps) of network capacity. Each Starship carrying 60 Starlink V3 satellites adds about 61 Tbps of capacity, meaning each launch could theoretically generate $1 billion in recurring annual revenue.

SpaceX CEO Elon Musk has set a goal of 10,000 Starship launches per year by 2030. In her post on X, Wood explained that at $1 billion per launch, 10,000 flights would be $10 trillion in annual revenue.

Musk had a short reply: "It's not impossible." While that's true, Musk is known for setting extremely ambitious goals, and this one is worth a reality check.

Flaws in the argument

There are several issues with this $10 trillion revenue projection for SpaceX. The biggest: The space company is nowhere close to 10,000 Starship launches per year. The first Starship launch was in 2023, and to date, there have been 14 total, including nine successes and five failures. Even across SpaceX's fleetwide flights, the total is 165 launches in 2025 and 116 so far this year (as of Oct. 8).

SpaceX's launch cadence is impressive, as it accounts for about 80% of all U.S. orbital launches, according to recent research by The Motley Fool. But going from less than 10 Starship launches per year to 10,000 by 2030 doesn't seem realistic.

Wood's calculations also assume that every flight carries Starlink satellites and revenue per terabit holds, neither of which is likely. The 10,000-flight goal could include passenger transport, in which case it wouldn't be exclusively satellite payloads. Revenue per terabit is already declining, from $23 million in 2024 to $19 million in 2025.

SpaceX doesn't look like a deep-value stock

SpaceX was richly valued at its IPO price, and it has only gotten more expensive. With a market cap of $2.2 trillion, it trades at about 102 times trailing sales. For perspective, Nvidia has a trailing price-to-sales (P/S) ratio of 19, and even Palantir Technologies, which is anything but a value stock, is cheaper at 83 times sales.

Wood's valuation of SpaceX is based on an extremely optimistic scenario years in the future. Right now, SpaceX is highly volatile and trading at a multiple several times higher than most tech companies.

Before investing, it's worth considering the worst-case scenarios, such as multiple compressions during a bear market, just as thoroughly as the best-case scenario.

Lyle Daly has positions in Nvidia. The Motley Fool has positions in and recommends Nvidia and Palantir Technologies. The Motley Fool has a disclosure policy.