By Al Root
SpaceX is the foundation of the growing commercial space industry. Its lofty valuation anchors what a host of other companies, with dreams of an ever-expanding infrastructure above the stars, are worth.
That is one of the reasons why the Wednesday publication of SpaceX's IPO registration was such a big deal. It's led to some wild trading in space stocks on Thursday.
SpaceX is seeking to raise tens of billions in an IPO, likely wrapped up in June, which will value the company at $2 trillion or more. Sales in 2026 should top $25 billion, leaving Elon Musk's rocket company trading for about 80 times sales.
Rocket Lab stock is a mini-SpaceX, with satellite-making and launch capabilities. Shares were down 4.5% in midday trading at $128.30. The S&P 500 and Dow Jones Industrial Average were down 0.2% and flat, respectively.
It trades for about 80 times estimated 2026 sales, too. Maybe investors believe it needs a discount to SpaceX. Or maybe they thought SpaceX's launch business was more profitable. SpaceX's launch business generated adjusted earnings before interest, taxes, depreciation, and amortization, or Ebitda, of $653 million in 2025, but that was down from $1.2 billion in 2022.
The Ebitda margin was 16%. Maybe investors wanted a higher number. Perhaps, but Rocket Lab stock was still up more than 410% over the past 12 months through midday trading.
Shares of launch Firefly Aerospace, which also has building and launch capabilities, were down 3.1% in midday trading, possibly for the same reason as Rocket Lab stock. Firefly, however, only trades for about 15 times estimated 2026 sales.
Investors feel better about the communications opportunity. Shares of AST SpaceMobile, which is building space-based broadband capacity analogous to SpaceX's Starlink, were up 6.9%, leaving shares up 302% over the past 12 months.
SpaceX's Starlink generated 2025 sales of $11.4 billion, and its adjusted Ebitda profit margins were 62%. Those numbers aren't a surprise, but they are impressive and, for the first time, are in official black and white. It shows the potential of a space-based communications business.
CoreWeave stock was up 5.4% in midday trading. That might come down to SpaceX's deal with Anthropic. The latter is paying SpaceX $1.25 billion a month for access to AI computing capacity. That shows the value of AI computing and the GPU-as-a-service strategy of CoreWeave.
Finally, EchoStar stock was down 4.6% in midday trading. EchoStar owns an estimated 260 million SpaceX shares, either already received or expected to be received, for selling SpaceX wireless spectrum.
That stock could be worth $40 billion after the IPO. That's the value of EchoStar stock today. Why the company isn't getting more credit for the rest of its business is hard to say.
Figuring out exactly what investors are thinking on a given day is always difficult.
Write to Al Root at allen.root@dowjones.com
This content was created by Barron's, which is operated by Dow Jones & Co. Barron's is published independently from Dow Jones Newswires and The Wall Street Journal.
(END) Dow Jones Newswires
May 21, 2026 14:14 ET (18:14 GMT)
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