The upcoming SpaceX IPO, which is scheduled to kick off on Friday, June 12, could result in Tesla Inc. (NASDAQ:TSLA) investors exiting their positions in the EV giant, according to investor Gary Black of The Future Fund LLC.
Investors To ‘Lighten’ TSLA Positions?
In a post on X on Wednesday, Black outlined that several retail investors participating in the SpaceX IPO “will lighten up on their TSLA positions to fund their SPCX shares.”
He added that lead underwriters for the IPO, Goldman Sachs Group Inc. (NYSE:GS) and Morgan Stanley (NYSE:MS), will “engineer a Day 1 pop for SPCX IPO investors,” citing “huge potential paydays” from upcoming IPOs of artificial intelligence companies Anthropic and OpenAI.
However, the investor said that the stock was still “richly priced” and that he would avoid participating in the IPO until the stock comes “back to earth post-IPO.”
SpaceX Offered Like Free Money
Investor Ross Gerber, co-founder of Gerber Kawasaki, also weighed in on Friday’s IPO. “People hitting me up for spaceX stock like it's some sort of free money,” the investor said in a post on X on Wednesday, illustrating the considerable buzz SpaceX has generated.
SpaceX IPO: Skepticism And Bullish Sentiments
The IPO has sparked bullish sentiments as well as skepticism. Sen. Elizabeth Warren (D-Mass) called for delaying the IPO, warning of “misleading” or “inaccurate” accounting of valuation and that the IPO could expose investors to improper governance structures.
NYU Stern Professor Aswath Damodaran, widely known as the Dean of Valuation, said that he would avoid participating in the IPO, citing concerns with SpaceX's valuation, as well as the $28.5 trillion market opportunity touted by the company in its prospectus.
Top Pension officials from New York and California have also criticized SpaceX's IPO, accusing Musk of creating a management-favorable structure, as the dual-class share structure would make Musk’s Class B shares worth 10 regular shares.
On the other hand, Deepwater Asset Management‘s Gene Munster called the IPO an exciting event for the tech industry, sharing that SpaceX could emerge as a rival for Alphabet Inc. (NASDAQ:GOOGL) (NASDAQ:GOOG).
Investor Ron Baron also expressed bullish sentiment for the IPO, predicting that the Elon Musk-led company could go on to become worth $30 trillion in the future, while Goldman Sachs reportedly shared with prospective investors that the company’s total revenue could reach over $474 billion by 2030.
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