Dec 15, 2022 - Economy & Business

SpaceX stock defies gravity

Note: Prices are adjusted for the 10-for-1 stock split in February 2022; Data: Rainmaker Securities; Chart: Erin Davis/Axios Visuals

Even as demand for private company stock has cratered pretty much across the board this year, there's at least one exception: SpaceX.

The big picture: "Pretty much every company we trade is down versus the end of 2021," Glen Anderson, co-founder of Rainmaker Securities, told Axios. "SpaceX is an exception," Anderson said.

  • In Q3, shares of private tech companies traded at a median discount of over 40% compared with their most recent primary fund-raising valuation, Axios recently reported.

State of play: Few companies are going public right now, which depresses demand for private company shares. Investors worry about the illiquidity of these shares.

  • But SpaceX, founded by Elon Musk, has managed to buck the trend because it's typically done an annual tender offer.
  • Investors have consistently been able to get liquidity during those windows, said Rainmaker co-founder Greg Martin.
  • Earlier this week, Bloomberg reported SpaceX's latest tender offer valued the company at $140 billion, citing people familiar with the matter. In July the company was valued at $127 billion, per PitchBook.
  • Plus: The company's Starlink business — which provides internet service via satellites — is taking off this year. "Some people believe [Starlink] could be a multi-hundred-billion-dollar business," said Martin.

The intrigue: Shares of Musk's public company, Tesla, are down 56% this year.

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