With what is expected to be the largest-ever SpaceX initial public offering (IPO) set for the 12th, analysts said a short-term upbeat trend is expected and the impact on the market will likely be limited.
SpaceX is expected to list on the U.S. Nasdaq soon. Based on the offering price, the expected valuation is about $1.75 trillion, and if that materializes, SpaceX is highly likely to go straight into the top-tier large-cap growth segment in the U.S. stock market upon listing.
Because the projected market capitalization and fundraising amounts are unusually large, concerns over liquidity continue to surface in the market.
Ha Jang-gwon, a researcher at Hyundai Motor Securities, said, "However, based on the offering price and market capitalization, the ratio of funds raised is 4.3%, far below the past mega-IPO average of 20%," adding, "Relative to the now-inflated total market capitalization, the fundraising ratio is similar to levels seen during previous mega-IPOs."
He also said that compared with past mega-IPO cases in the U.S. stock market, the current macro environment is favorable for IPOs.
Ha said, "Looking at cases including Alibaba, Visa, Meta, GM, and Rivian, most proceeded under weaker conditions compared with today's accommodative financial settings."
He said the most fluid variable that could sway financial conditions now is the course of the Iran war. Ha said, "The trajectory of the Iran situation will act as a more sensitive factor for elastic share-price momentum (upward drivers) immediately after the IPO."
As for SpaceX's share price, the combination of a markedly low free float and resulting Nasdaq 100 passive inflows was expected to produce an optimistic short-term trend.
Ha said, "In May, ahead of listings by giant tech corporations like SpaceX, Nasdaq abruptly revised its index inclusion rules," explaining, "To address the possibility that a standard market-cap-weighted method would leave such stocks with trivial weights, it decided to apply three times the actual free-float ratio for constituents with a free-float ratio under 33.3%."
In addition, at the end of May, a competitor, Blue Origin, suffered a rocket explosion during a launchpad static fire test, a development that strengthened SpaceX's dominance.
However, the markedly low free float was projected to become a double-edged sword down the road.
Ha said, "Right after listing, it will work as a supportive factor, but the potential for future equity dilution is also considerable," adding, "Given the price-to-sales ratio (PSR) that is markedly high relative to revenue, downside pressure on the stock is unavoidable in a midterm view."
He added that, excluding SpaceX, Meta and Rivian—which had the highest PSRs—also suffered the largest midterm declines.
Meanwhile, multiple mega-IPO events are slated for the second half of this year in the U.S. stock market. After SpaceX, OpenAI and Anthropic are also expected to proceed with listing processes in the second half.