Jay Woods, chief market strategist at Freedom Capital Markets, has raised concerns about the valuation of SpaceX ahead of its IPO on the Nasdaq, where shares are priced at $135 each. This pricing would value the company at $1.77 trillion, positioning it as the seventh-largest U.S. company by market capitalization, surpassing Tesla.
Woods suggests that investors should consider entering the stock in smaller amounts due to its uncertain valuation and potential for volatility. Morningstar analysts have also labeled SpaceX as 'significantly overvalued,' estimating its worth at about half of the IPO price.
They believe that investors may find better buying opportunities after the IPO, as stocks associated with major IPOs often struggle in their first year. Woods emphasizes the importance of being cautious and suggests that there will likely be pullbacks in the stock price, indicating a volatile trading environment ahead