How far could SPCX fall?

SpaceX was riding high when I posted my dataviz of tech giant market capitalization vs. revenue. By this morning, it was down from its peak by about 50%.

Click to enlarge & interact. Note that this is not updated in realtime.

Is this the bottom? In a rational universe, I think not, because even its deflated valuation is still an outlier.  But remember Keynes’ warning, that the market can stay irrational longer than you can stay solvent. Also, recall that market capitalization (not just for SPCX) isn’t real money; it’s paper value based on the marginal transaction, and can change fast if those transactions are thin. Since the SPCX float is small, The $1.4T valuation reflects far fewer $ invested, and could be sustained by a dedicated enthusiast cadre – but the temptation to defect will presumably be large as locks expire.

Lost in SpaceX

I think this chart shows pretty well just how wild the SpaceX IPO is. Extrapolate at the slopes of other mega tech companies: if it had Amazon’s revenue today, it would be almost as large as the entire S&P500 by market cap. At present revenue, its multiple is massive compared to Meta, Nvidia and Amazon. Don’t even think about the PE ratio.

Click to enlarge. This is a combination of SEC EDGAR filing data, yfinance and a few ad hoc sources for checking stock splits and so forth.