SpaceX surges by double digits on second day of trading, but experts remain divided

[Financial News]  

SpaceX posted another double-digit surge on the 15th, its second day as a listed company.
After jumping 19% on its first trading day on the 12th following the successful debut of the largest initial public offering (IPO) on record, SpaceX opened on the 15th with gains of more than 6% and then widened those gains, extending its two-day rally to 19%. It closed at $192.50, up $31.55, or 19.60%, on the day.
The stock has surged 42.6% over its first two days of trading. According to CNBC, trading volume around noon that day reached about 120 million shares. On the 12th, it had reached 500 million shares.
In a post on his social media platform X on the 14th, SpaceX founder and CEO Elon Musk said revenue could approach $1 trillion by 2030. He added that it would be surprising if revenue did not exceed $1 trillion in 2031. SpaceX posted revenue of $18.7 billion last year.

As it was confirmed that SpaceX had secured $85.7 billion in its IPO on the 12th, CFRA issued a sell rating.
In an analysis note on the 12th, CFRA initiated coverage of SpaceX with a sell rating and set a 12-month target price of $115. That was 29% below the closing price on the 12th.
CFRA said its bearish view stemmed from "the company's overly ambitious growth strategy, excessively elevated valuation expectations, and heavy capital concentration."
From January through March this year, SpaceX spent a total of $10.1 billion in capital expenditures over three months. That was more than double the $4.1 billion spent in the same period last year. Most of it went into artificial intelligence (AI).

Earlier, on the 8th, Morningstar, Inc. analyst Nicholas Owens valued SpaceX at $63 per share in an analysis note. He said the $135 offering price was overvalued.
Polina Roskowska, a finance lecturer at Bayes Business School, said SpaceX had "made a lot of promises" and would eventually need to turn those promises into profits.
Roskowska noted that, beyond the wording on orbital data centers, which is already an extremely ambitious promise in itself, SpaceX has made a series of highly optimistic commitments. She said the company now faces pressure to turn those ideas into reality.
She added that SpaceX has not presented any concrete plan for how it will make those promises a reality, nor has it outlined the risks involved in execution. "I don't know on what basis they made these promises," she said.

By contrast, Newstreet Research initiated coverage of SpaceX with a first target price of $165.
James Bratcher, a senior analyst and partner at Newstreet Research, said investors need to look 20 to 25 years ahead, and that from that long-term perspective, the current valuation is reasonable.
He said SpaceX is "at least 10 years ahead" of its rivals when it comes to rocket launch capabilities.
Bratcher emphasized that everything from Starlink's satellite phone service to orbital data centers depends on successful rocket launches, and that SpaceX has a significant advantage in that area.
dympna@fnnews.com Song Kyung-jae Reporter