SpaceX IPO Mechanics & Demand (with Romaine Bostick, Katie Greifeld)

SpaceX IPO is massively oversubscribed, especially on the retail side with up to $100B in orders. The $135 price was set by Musk to take leverage away from institutional asset managers. The expectation is a 'crazy open' on Friday, but potential for a sell-off in the afternoon. The retail allocation is unusually high (30%) as management believes retail investors understand the story better than Wall Street.

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SpaceX IPO Mechanics & Demand (with Romaine Bostick, Katie Greifeld)

The SpaceX IPO is massively oversubscribed. How much?

Romaine Bostick
Ed Ludlow

Massively oversubscribed. $135 a share, $75 billion raised. The price was set by Musk and the CFO, not bankers. On the retail side, massive oversubscription up to $100 billion. Expect a crazy open on Friday, but a potential sell-off in the afternoon.

The reason they set $135 early was to take leverage away from long-only asset managers who were willing to bid it up.
What does the oversubscription portend for the stock's open tomorrow?

Katie Greifeld
Ed Ludlow

The belief within SpaceX management is that retail investors understand the story better than Wall Street, analogous to Tesla. Their hope is that the large retail allocation will hold the stock for a long time, avoiding short-termism.
Will Elon Musk be at the Nasdaq for the first day of trading, similar to Tesla's IPO 16 years ago?

Romaine Bostick
Ed Ludlow

A lot of people important to the company will be in Texas, not New York City. Tesla was a niche player; SpaceX is a much more diversified market. The orbital data center opportunity is being taken seriously, with many modeling cash flows sooner than 2028.

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