It’s not too late to cash in on the new space race |
Elon Musk fans might soon have a new stock to fixate on: SpaceX.
Over the past few weeks, news has been filtering out that Musk’s company might be about to launch a spectacular listing on the stock market.
This image from a SpaceX livestream in August shows the 10th Starship mission splashing down in the Indian Ocean.Credit: AP
Executives are reported to be selecting investment banks to run the initial public offering, which could be worth $US1.5 trillion ($2.2 trillion). Not bad given SpaceX is expected to make $US25 billion of revenue next year.
According to analysts’ estimates, SpaceX revenues are due to hit $US48 billion by 2030 with net earnings of about $US10 billion.
It’s also an impressive valuation, given that the business was valued at just $US350 billion this time last year. Then again, with its Starlink business selling broadband packages at $99 a month, I reckon these revenue forecasts might be conservative.
If a stock market listing does happen, it will be a win for British fund manager Baillie Gifford, which has consistently backed Musk.
Its public funds are heavily invested in SpaceX. Shares in Musk’s company represent around 15 per cent of the portfolio of Scottish Mortgage (where I own shares), 14 per cent of the Schiehallion fund and about 16 per cent of Edinburgh Worldwide Investment Trust.
So, why the $US1.5 trillion valuation? What’s got investors so excited is that SpaceX is in the vanguard of three fundamental shifts in space technology, or spacetech.
The first is its reusable rockets. Private companies have long........