Another Musk Capital Myth in the Making? As SpaceX’s IPO Nears, Volatility Could Eclipse Tesla’s

In recent years, SpaceX has evolved into a major force in the aerospace industry, driving exponential growth in market interest. However, investors should anticipate significant volatility in the company’s stock price following its public listing.

Bloomberg reports that SpaceX may file for an IPO as early as this month, targeting a valuation exceeding $1.75 trillion. The company plans to go public in June, potentially aligning with Elon Musk’s birthday or a rare planetary alignment. Headquartered at Starbase, Texas, SpaceX reached an estimated $1.25 trillion valuation after integrating Musk’s artificial intelligence company xAI.

According to a report by PitchBook analyst Franco Granda, SpaceX’s post-IPO stock performance will likely mirror Tesla (TSLA.O), “but with greater volatility.”

Future Growth Outlook: Starlink as the Primary Revenue Driver

PitchBook projects SpaceX revenue to reach $150 billion by 2040, with adjusted profits of $95 billion.

In contrast, the company’s top-line revenue last year was approximately $16 billion, with profits around $8 billion. Going forward, about $42 billion in annual revenue could stem from the Starlink satellite internet business, which currently generates most of SpaceX’s cash flow.

These projections do not include xAI, which is currently burning cash rapidly but could secure more contracts from the U.S. Department of Defense in the future. The estimates also assume Tesla and SpaceX will remain separate entities, even though Musk and some analysts have discussed potential consolidation.

Last November, Musk posted on X: “My companies, somewhat surprisingly, are moving toward convergence.”

The Musk Effect: Vision-Driven Leadership, Flexible Timelines

Granda noted that lessons investors learned from Tesla may apply equally to SpaceX. Both companies are shaped by Musk’s trademark public optimism.

For instance, Granda recalled Tesla’s pledge to produce 5,000 cars per week by the end of 2017, only to fall into “production hell” and miss the goal. When the company finally hit the milestone in mid-2018, the stock price surged.

SpaceX has experienced similar delays. The Starship super heavy rocket program has encountered repeated setbacks, and other spacecraft projects have faced comparable challenges in the company’s history. Musk set 2022 as the “ideal target” for an unmanned Mars mission, but by 2026, the mission remained years away from realization.

Investors, however, have grown accustomed to Musk’s flexible timelines.

As a result, when the December deadline for the autonomous taxi project passed, investors were not overly concerned. When Musk ultimately delivered, the stock price rose. Granda terms this a “credibility ledger”—investors price in delays but focus on the overarching vision.

This dynamic could benefit SpaceX. The company recently delayed its Mars colonization plans and has applied to regulators to launch up to one million space data centers into orbit, contingent on Starship’s progress. SpaceX also aspires to build a city on the moon.

Post-IPO Challenges: Heightened Volatility and Musk Dependency

As a public company, however, SpaceX will need to achieve its targets for Wall Street while advancing its xAI and Starlink businesses, which could spark dramatic market reactions.

Granda predicts that news which might move Tesla shares by 10–15% could lead SpaceX stock to swing by 20–30%, in part because only about 3.3% of SpaceX shares are expected to be publicly traded.

SpaceX may also enjoy the so-called “Musk premium.” Even as Tesla’s core EV business has faced challenges, this premium has helped support the stock price. However, this effect also underscores the company’s heavy reliance on Musk.

Cantor Fitzgerald analyst Andres Sheppard previously stated:

“Today, more than 50% of shareholders would say Tesla is Elon, and Elon is Tesla. Many, if not most, directly associate Tesla’s success with Elon’s tenure.”

Tesla’s annual report notes the company’s reliance on Musk and warns that if he were forced to sell part of his holdings, the stock could decline. Musk, who founded SpaceX more than twenty years ago, currently owns about 44% of the company, signaling similar dependency at SpaceX.

Granda suggests that negative news from Tesla could weigh on SpaceX stock, and vice versa. Musk’s political positions have also sparked controversy and affected Tesla’s sales. Granda concludes:

“With a lower free float, earlier-stage technology, and high concentration of ‘Musk risk,’ SpaceX volatility could exceed even the historically high volatility seen at Tesla.”

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