Key Highlights
- In a remarkably swift move, SpaceX secured a place in the Nasdaq-100 merely 15 days following its June 12 market debutâamong the quickest additions in history.
- Index-tracking funds are projected to purchase between $4.3 billion and $6 billion worth of SPCX shares to align with the updated index structure.
- Both Morgan Stanley and Goldman Sachs launched coverage on Tuesday with their highest ratings; Goldman described the opportunity as potentially “multi-trillion-dollar.”
- The company enters the index with a float-adjusted weighting equivalent to approximately $300 billion, though only about 638 million shares are publicly tradeable.
- An additional 20% of shares will become available following the company’s inaugural earnings announcement, scheduled for the coming weeks.
Space Exploration Technologies Corp. (SPCX) secured its position in the prestigious Nasdaq-100 on Tuesday, achieving this milestone a mere 15 days after making its June 12 stock market entranceâmarking one of the swiftest index entries in market history.
Space Exploration Technologies Corp., SPCX
During premarket trading Tuesday, shares declined approximately 1.5% to reach $158.37. Following its public offering, SPCX has experienced a trading range between a peak of $225.64 and a low of $147.11.
The inclusion wasn’t straightforward. Nasdaq employed updated regulations for recently listed entities, enabling SpaceX to meet eligibility criteria despite its abbreviated trading record.
The Nasdaq-100 index represents the largest non-financial corporations listed on the exchange. SpaceX now shares membership with industry titans including Apple, Nvidia, Alphabet, Amazon, Meta, and Broadcomâa collective boasting nearly $40 trillion in combined market capitalization.
Commanding a market capitalization of $2.1 trillion, SpaceX currently ranks as America’s sixth-most valuable corporation. Chief Executive Elon Musk earned distinction as the planet’s first trillionaire.
The company generated $86 billion through its initial public offeringâestablishing a new recordâthough this represented merely a portion of its $1.8 trillion IPO valuation. Presently, approximately 638 million shares remain accessible for public trading, valued at roughly $102 billion.
Recognizing the constrained float, Nasdaq weighted SpaceX at triple its tradeable market capitalization, effectively granting it the index influence of a $300 billion enterprise. This calculation translates to approximately 0.75% of the Nasdaq-100’s aggregate value.
Index Funds Preparing Multibillion-Dollar Purchases
More than $587 billion in assets track the Nasdaq-100, including Invesco’s popular QQQ and QQQM exchange-traded funds. These investment vehicles must now acquire SPCX shares to mirror the index composition.
J.P. Morgan projected last month that this addition might generate $4.3 billion in passive investment flows. Barron’s estimates approach $6 billionârepresenting approximately 6% of all publicly available SPCX shares.
Market participants seem to have positioned themselves ahead of time. SPCX has climbed roughly 10% from its recent nadirs approaching Tuesday, potentially incorporating some anticipated indexation demand.
Additional shares are forthcoming. Approximately 20% of SpaceX’s equity becomes unlocked following the company’s initial earnings disclosure, anticipated within several weeks. This should alleviate some supply-demand imbalances.
Major Investment Banks Launch Coverage With Optimistic Outlooks
Tuesday also signifies the conclusion of the underwriter quiet period for financial institutions including Goldman Sachs, Morgan Stanley, BofA Securities, Citigroup, and J.P. Morgan.
Morgan Stanley launched coverage with its premier rating, characterizing SpaceX as “AI’s final frontier.” Goldman Sachs similarly commenced coverage at its top tier, asserting that each of SpaceX’s primary markets possesses the capacity to evolve into a multi-trillion-dollar opportunity within five-plus years.
RBC, Bernstein, and Stifel added their voices with maximum ratings, with RBC emphasizing StarshipâSpaceX’s completely reusable next-generation launch vehicleâas the “flywheel that powers SpaceX’s ambitions.” Oppenheimer had previously initiated an “outperform” rating in June.
Universal enthusiasm remains elusive. Morningstar assigned SpaceX a valuation near $780 billion, citing ambiguity surrounding its artificial intelligence ventures, including xAI and social platform X.
S&P Global refused to establish an expedited pathway for S&P 500 membership in June. SPCX’s entry into that benchmark could require at least twelve months.
FTSE Russell incorporated SpaceX into its U.S. benchmarks last month, with the iShares Russell 1000 ETF already providing investors access.
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