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We Think the SpaceX IPO Is Overvalued

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Re: We Think the SpaceX IPO Is Overvalued

#61

Post by ElProlactin »

ink_13 wrote: post #52
ElProlactin wrote: post #37

Earlier quoted context omitted.

> ...and dangerously untethered the stock market is from reality. "Disconnected from historical valuation norms" is a more sensible statement. The idea that the stock market is "detached from reality" is dangerous too because the stock market is...reality. People make and lose real money in it every day. There are good arguments that the historical valuation norms are reasonable and deviation from them is "dangerous"…

For certain values of "reality". It doesn't take a financial analysis to tell you that it is bananas that Tesla (~1.3T) is worth more than four times as much as Toyota (280B), and yet.

But there's no law that says prices must be based on standard financial analysis.

You and I and a million other people might run away from Tesla's valuation but that doesn't mean that the market must.

I think it's very obvious that the historical norms that governed and explained pricing in the stock market no longer apply, for better or worse. Between the massive manipulation of the markets by central banks to the rise of the retail investor (and social media, meme stocks, etc.), there are a lot of factors in play that weren't a thing 30 years ago.

Re: We Think the SpaceX IPO Is Overvalued

#62

Post by dozerly »

redox99 wrote: post #54
oldfuture wrote: post #15

And the prospectus says it plainly: "Mr. Musk will be able to control the outcome of matters requiring shareholder approval." Musk holds over 85% voting power through Class B super-voting shares (10 votes/share). Public investors combined will have 15%. What Musk Controls: - CEO removal = his consent. You can't fire him even if he destroys the company - Take business for himself. SpaceX gets a rocket deal? Musk can s…

I think this is a very big issue. If SpaceX is very successful, will he pay out dividends, or will he spend everything on a mission to mars at a massive loss or something like that?

It’s very simple. You should expect he will do whatever benefits himself.

Re: We Think the SpaceX IPO Is Overvalued

#63

Post by readthenotes1 »

verandaguy wrote: post #59
oldfuture wrote: post #15

And the prospectus says it plainly: "Mr. Musk will be able to control the outcome of matters requiring shareholder approval." Musk holds over 85% voting power through Class B super-voting shares (10 votes/share). Public investors combined will have 15%. What Musk Controls: - CEO removal = his consent. You can't fire him even if he destroys the company - Take business for himself. SpaceX gets a rocket deal? Musk can s…

This should frankly be disqualifying for any company trying to go public. Super voting shares have their place but there's no scenario in which overall control of the company can be retained by super voting shareholders who make up a small minority of the overall shareholders. The point of a company going public is not to just distribute possible profits among speculators, but to give the public a meaningful voice in…

It should be described so buyers can beware, but it's a personal choice to decide whether someone trust Musk and his estate planning

Re: We Think the SpaceX IPO Is Overvalued

#64

Post by protocolture »

m-hodges wrote: post #2

> Even at $63 per share, we give SpaceX a lot of benefit of the doubt in two of the three scenarios, in which we assume the company can achieve a rapidly reusable Starship rocket enabling multiple launches per week and successfully commercialize data centers in space. > In our downside scenario, orbital data centers won’t work or offer any advantage over terrestrial ones. We surmise that the company, having invested…

Do they have a projection for what the company will be valued when he gets to mars by 2017?

Re: We Think the SpaceX IPO Is Overvalued

#66

Post by hparadiz »

SwellJoe wrote: post #48
pryce wrote: post #35

Earlier quoted context omitted.

I feel like we are going to relive the hyperloop-decline with the specs of proposed orbital datacentres. But the hyperloop was in one regard a success, in that it built temporary hype. Maybe it was even named after that.

It also achieved Musk's actual goal: derailing and delaying mass transit initiatives, the California High-speed Rail project, in particular. He knew it was bullshit. He's dumber than most people realize, but he's not dumb enough to actually believe all the bullshit he spouts.

He's sending the weirdest mixed signals. If we want to hit anywhere near 1 on the Kardashev scale we're gonna need a planet wide high speed rail system. They should just give the major tech companies naming rights to the stations for 35 years for like 2-3 billion a pop and scale up construction 5x.

I don't get the slow roll on this thing. The stations in LA and SF are gonna end up sort of like Tokyo station for the Shinkansen. A giant mall area with a huge amount of commerce. Why isn't this thing done yesterday?

Re: We Think the SpaceX IPO Is Overvalued

#67

Post by darth_avocado »

bayarearefugee wrote: post #3

> We Think the SpaceX IPO Is Overvalued Well... yeah, sure, everyone thinks that. And the fact that it doesn't matter and won't impact demand for shares illustrates how increasingly and dangerously untethered the stock market is from reality.

> And the fact that it doesn't matter and won't impact demand for shares illustrates how increasingly and dangerously untethered the stock market is from reality.

Part of the reason for this demand is the fact that index tracking funds like QQQ will be forced to buy up massive volumes of shares. Not only that but other non index tracking funds that track large cap stocks will also have to buy. Vanguard large cap for example manages trillions of dollars. That in itself will have 100s of billions worth of buy orders.

Re: We Think the SpaceX IPO Is Overvalued

#68

Post by verandaguy »

readthenotes1 wrote: post #63
verandaguy wrote: post #59

Earlier quoted context omitted.

This should frankly be disqualifying for any company trying to go public. Super voting shares have their place but there's no scenario in which overall control of the company can be retained by super voting shareholders who make up a small minority of the overall shareholders. The point of a company going public is not to just distribute possible profits among speculators, but to give the public a meaningful voice in…

It should be described so buyers can beware, but it's a personal choice to decide whether someone trust Musk and his estate planning

Technically, it is described. It's described in the S-1. Trouble is that most (active) investors don't read the S-1.

Fund managers and the like do, which covers a lot of passive investors, which is good until a company joins one of the major indices at which points funds may be obligated to buy in.

It's a deeply distressing moment, and I see it as a time to renew calls for consumer-protecting regulations and antitrust laws with more teeth in the markets where this kind of behaviour's currently flourishing.

Re: We Think the SpaceX IPO Is Overvalued

#69

Post by ianburrell »

hparadiz wrote: post #17
kldavis4 wrote: post #10

Earlier quoted context omitted.

The orbital data center thing is really strange. Without some kind of massive technological breakthrough the physics of an orbital data center make no sense. Napkin math for a single data center including solar panels, radiators, compute and structure is somewhere on the order of ~6500 tonnes. Let's say Starship can put 100-150 tonnes into orbit per launch, that is somewhere between 40-65 launches for just one single…

The video they posted today outlines their specs. They are gonna be smaller. About 100T. Based on Starlink architecture but with way larger radiators and solar panels. Apparently the design is simpler than existing Starlinks because it has fewer different parts. Specs: https://x.com/SawyerMerritt/status/2064108916611420273?s=20

150 kW is tiny, that is a single rack. Would have to launch a huge number of them to match the GW data centers being built. There is also a lot of overhead for each one.

If Starlink didn't exist, then it could make sense to put edge data centers in orbit. But Starlink means can put edge computing everywhere on the ground.

Re: We Think the SpaceX IPO Is Overvalued

#70

Post by Terr_ »

credit_guy wrote: post #16
kldavis4 wrote: post #10

Earlier quoted context omitted.

The orbital data center thing is really strange. Without some kind of massive technological breakthrough the physics of an orbital data center make no sense. Napkin math for a single data center including solar panels, radiators, compute and structure is somewhere on the order of ~6500 tonnes. Let's say Starship can put 100-150 tonnes into orbit per launch, that is somewhere between 40-65 launches for just one single…

> Let's say Starship can put 100-150 tonnes into orbit per launch, that is somewhere between 40-65 launches for just one single orbital data center. Ok. And why does it follow from this that the physics of an orbital data center makes no sense?

No, you've got the burden of proof backwards: We haven't even begun to talk about maintenance issues, space-proofing the equipment, power-generation, cooling, etc.
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