SpaceX at its IPO price
SPCX trades near $139 to $140 a share, up about 1% in the pre-market. It has round-tripped back close to its IPO price after a wave of early excitement. At this level it looks like a good entry point.
The long-term case is strong enough to call it a 20-year hold. Inside the XOVR fund, a roughly $2.1 billion fund, SpaceX is the top holding at about a $330 million position. The comparison is Nvidia, bought 21 years ago at $5 a share and held ever since through many rebalances. SpaceX is treated as the same kind of long-term hold, the top weight among the "Mag 7," here called the "Elite 8." It looks like the strongest of these companies and could become the biggest of the eight within as little as 3 to 5 years.
For an investor with only a 5-to-10-year horizon, the case still holds. Within 3 to 5 years this looks like the dominant company of the group, liked better than Apple. The fund owns none of Apple, Microsoft, Amazon, or Tesla right now. It holds Meta, Google, and SpaceX, with SpaceX by far the largest.
Three businesses, one empire
Think of SpaceX as three engines.
Launch. SpaceX holds 90% of all satellites in space. Competitors like Amazon now have to use SpaceX rockets to get their own satellites up. Elon Musk works like a modern-day Rockefeller by cutting cost: launch has dropped from $54,000 per kilogram to $2,000, with a push to go lower. The government it competes against moved the wrong way over the last 30 to 40 years, from $54,000 up to $58,000 per kilogram. An entrepreneur beating a government on cost this badly means the outcome is settled.
Starlink. This is the cash cow and the crown jewel. It has leapfrogged cellular and grown from zero to 10 million customers in a short time. Earnings, possibly out as early as August 6, should confirm its dominance. It competes against telecom, described as the most bureaucratic industry on the planet, where rivals are locked into legacy systems. Starlink runs a five-tier pricing model on the same satellites: domestic, maritime, defense, business, and aviation. Aviation is charged about 313 times more than domestic. A five-tier pricing model plus the strongest entrepreneur against the most bureaucratic companies makes the result one-sided.
Those two businesses alone justify a valuation well north of $1 trillion, probably closer to $1.25 to $1.5 trillion.
The long-shot: data centers in the sky
The third engine is optionality: data centers in orbit. This is a low-probability, high-payoff bet. The physics and the cost are hard, and on the ground people resist data centers in their backyards. For most people this idea would be a zero-probability play; with Musk it is a low but real probability. If he pulls it off, SpaceX becomes worth many times more than any other company on the planet, the most dominant company anywhere. People have bet against him before and lost, so his track record earns him the chance to try.
On the coming AI IPOs
Other mega IPOs are expected this year, including Anthropic, with OpenAI possible. These may pull some demand, but the fund plays in private markets directly. Its ETF was the first to buy into private companies, entering SpaceX in 2024 as the first to do so, with a second stake in Kalshi announced the prior day.
Anthropic and OpenAI are under watch. OpenAI's pricing has come down from its earlier frothiness. Anthropic is now getting very frothy and highly priced, with many bidders pushing valuations to what look like unreasonable levels. Some brokers are marketing private shares at 60% to 70% over the last round to play on scarcity, and chasing that is off the table. Prices are running ahead of the fundamentals. These are great companies, but Asian rivals like DeepSeek can drag valuations down, and growth markets face possible headwinds.
The earnings backdrop
This earnings season looks strong. JP Morgan and other big banks reported record profits. Earnings should keep growing at rates never seen before. The favored metric is revenue per employee, a measure of productivity, now above half a million dollars per employee for the S&P 500 and multiples of that at some firms, from $1 million to $2 million up to $6 million per employee at companies like AppLovin. Anthropic and OpenAI carry a lot of growth and are worth buying at the right price, which is why having someone shop on your behalf for good value matters.
