SpaceX IPO: My Complete Trading Plan With 30-Day and 6-Month Price Targets

What's up everyone? All right, in today's episode, 
I'm going to break down everything that you need   to know to prepare for the SpaceX IPO this Friday, 
June 12th. We've got a lot to cover in today's   class. This will be a deep dive, parallel stories 
here. We're going to talk about the fundamentals   of SpaceX, and we're also going to talk about the 
technicals. As many of you already know, I am a   trader, and I don't have any skin in the game. I 
don't really care long term if SpaceX goes up or   it goes down. Everything that I share with you is 
through the lens of this creates volatility. And   as a trader, I crave volatility. I make money 
when things are moving. So whether it goes up   or goes down, I'll find an opportunity. But I do 
have a thesis that I'll share with you of what I   think it's going to do after the IPO. In fact, I 
have a pretty confident sense of what's going to   happen over the next two weeks from the day of 
the IPO and then going into the next 180 days.   So 6 months out, I have a good sense of what this 
is going to look like and I'm going to share that   with you. So would I be a trader of SpaceX on the 
day of the IPO? Would I be an investor of SpaceX   on the day of the IPO? Those are questions that 
I'm going to answer in today's class. Everything   that I share with you comes straight from primary 
sources, including the perspectives filed with   the Securities and Exchange Commission 
by SpaceX. It's called an S1 filing. So,   I'm not sharing with you fluff and icing of 
opinion of all the things I think SpaceX could   do. I'm just sharing with you what they actually 
are saying they're going to do. Some of which   does seem like hyperbole, but nonetheless, it's 
what I'm going to share with you here today. So,   let's go ahead and jump on the screen share. I 
do have a slide deck. We've got a lot to cover,   but maybe I'll begin by just jumping on the 
whiteboard for a second. So, let's sort of talk   about the outline of today's class. Um, number 
one, it's important for us to talk about the   fundamentals of SpaceX. And when we're talking 
about the fundamentals, we're talking about   uh the company, uh what they do, who they are. 
We're talking about um how much money they make.   We're talking about the valuation methodology 
for this IPO, which is currently valued at   just under $2 trillion, which is incredible. Um 
we're going to talk about potential headwinds   um that they face as a company. Um but we're also 
going to talk about the um the Elon Musk factor,   right? This is uh no doubt a huge part of the 
story. And when you're investing in SpaceX,   you're you're really investing in Elon Musk 
here. It's this is about investing or backing   um the jockey, not the horse. That regardless of 
what Elon Musk is doing, if you're an investor   long-term in SpaceX, you believe in him. And 
so we'll get into that in a little bit more   detail. So that's the story of the fundamentals, 
which is important. And then we have the story of   um number two, the technicals. So, the technicals 
for SpaceX are very interesting. We're going to   talk about how um how a hyped up IPO uh typically 
trades. So, I'll give you examples from other IPOs   I've traded in the past. Um, and that gives me a I 
I already have a good sense of how a hyped up IPO   will trade. But then we're going to talk about 
why Space X is different from those other hyped   up IPOs because there are some very significant 
differences that come down to a um structural um   component. Essentially, the way the company has 
been structured just based on this initial public   offering has actually really set it up to succeed, 
which is very interesting just structurally. So,   we'll talk about that. Um, and then we're going 
to get into um a little bit of historical context   about uh the trend that we've seen in the past 
um number of years when it comes to these big   IPOs and what that means for retail uh traders 
and investors like you and me. Uh I will also   touch on some adjacent investments or trades that 
I think actually have um that are perhaps more   interesting. In the past couple weeks, I've had 
a couple of huge trades on stocks that were space   theme. So, these are small cap companies that put 
out news of getting into the space sector. So,   whether it was space um data centers or um doing 
something to do with space right now, that theme   is very hot. And so we may actually see more ROI 
on some of these um almost sympathy stocks that   are piggybacking on the SpaceX momentum, but that 
have such lower valuations that they could much   uh more easily go up 10x or more. Whereas for 
SpaceX to go up 10x, well, gez, I mean, it would   have to be a a 20 nearly 20 trillion market 
cap for that to happen. So that's going to be   um uh that's going to take a while. All right, so 
let's go ahead and jump on the slide deck here and   we'll begin with the fundamentals story. So when 
we're talking about the fundamentals um of SpaceX,   number one, you have to recognize that what 
we currently have are um the the fiscal year   2025 financials. This is from the S1. So this is 
directly from the filings that um SpaceX has made,   which is u good. This is a primary source. So what 
we know is last year they brought in total revenue   of $18.7 billion. That's a lot of money on the one 
hand. Um on the other hand context is important.   Uh we will put this into context. This is about 
80% less money than Nvidia brought in. And yet   uh SpaceX is being valued uh very high relative 
to Nvidia. Nvidia is profitable. SpaceX is not.   This is very interesting. Again, SpaceX has the 
benefit of Elon Musk and the whole story around   him. And so that um it's it's not really an apples 
to apples comparison, but um but many people do   try to look at comps to understand um what should 
be the market cap for a company doing 18.7 billion   in total revenue and yet losing 4.9 billion. So 
they had a net loss last year of 4.9 billion. But   when you break down uh the financials, there are 
three segments of SpaceX. You have connectivity,   space and AI. So connectivity is the Starlink 
system. And I will say full disclosure that I use   Starlink. I have three subscriptions right now. So 
I have three Starlinks. I have them on mounted on   my cars. I don't use them at home. Um but I love 
SpaceX. I love um Starlink and SpaceX um I guess   uh through that it's been really good over 
the past uh four years. So and it has been   getting better and better. So this is the 
interesting thing is that uh the Starlink   has such a competitive advantage in connectivity. 
They have at this point about 10,000 satellites,   the these constellations of satellites providing 
the internet connectivity for the Starlink   um system. It it's really really great 
internet. Now, if you were in New York City,   you're in a very congested area or you're inside 
a building and things like that, you don't have a   view of the sky, then it's not very good for you. 
But the fact is, uh connectivity represented about   61% of their revenue in 2025. and it actually 
produced a profit. It is a profitable segment   of the business. Now, if you were going to invest 
in SpaceX purely for Starlink, you're essentially   investing in a telecom company. And telecom is 
not a sexy investment. People don't invest big in,   you know, Verizon and T-Mobile and whatever, 
whatever, because it's not that sexy. Why not?   Because they're regulated monopolies. Essentially, 
that's they are a monopoly, but they're regulated   by the government. And so Starlink, because 
they are dominating in satellite internet,   I unfortunately think that a potential headwind 
is that they're going to become a target for   uh regulatory action. And now probably not under 
the current administration, but in the future,   probably. Nonetheless, right now, it's their 
most profitable segment for 2025. Space produced   $4 billion of revenue, but it operated at a 
loss, as you can see right here. And AI produced   uh $3.2 2 billion in revenue but had a substantial 
loss in uh 2025. So that kind of sets the stage   there. Now to dive a little bit deeper on the 
connectivity side. So Starlink is the most   successful division of SpaceX with 11.4 billion in 
revenue and a profit of 4.42 billion. They've got   10 million subscribers and they've got a a fairly 
substantial total available market. In fact,   there's huge areas of the world where um Starlink 
would be your only source of internet. You don't   have fiber, you don't have cable, and so they have 
a huge total available market. But there is some   question about how many people really are going 
to become a subscriber. It's not cheap. Uh it is   fairly expensive. I probably pay like $700 a month 
between my three subscriptions that I have. Um,   the actual satellites, one of them I paid $5,000 
for, the premium or the performance in motion one,   the one that's like the size of a pizza box. 
So, you know, it's it's not something that   just anyone's going to buy. And nonetheless, uh, 
you still have this anti- monopoly um, risk. Then   you've got the space division of SpaceX. SpaceX 
is the leader in space. They're also the leader,   of course, in connectivity for satellite. Their 
engineering far exceeds any nearby competitors.   And if competitors such as Amazon wanted to 
launch their own space connectivity surf services   services to compete with Starlink, they would need 
to launch using SpaceX rockets. So you know that   creates a real stronghold on this entire sector 
and that's one of the benefits of having a company   that can do so many different things. One segment 
can support the other segment. So the space   segment is supporting the connectivity segment, 
right? And now the AI segment is going to be   supporting both of the other two segments. So that 
creates a huge economic moat using the expression   of um Benjamin Graham or um Warren Buffett. So 
while space operated a loss in 2025, it's given   SpaceX a significant strategic advantage. Now we 
have AI, the third segment of uh the business.   And this is again just diving first into the 
fundamentals. AI includes their data center,   Grock and Twitter X. So SpaceX owns Twitter X. All 
right. So that's important to take it to take note   of. All of the investors that helped Elon Musk 
buy Twitter and take it private got shares of   SpaceX. So they're now shareholders of SpaceX. 
The profit, generally speaking, of Starlink is   being spent on space and AI. And in 2025, AI was 
the biggest loser. However, earlier this year,   SpaceX ann SpaceX announced they would be earning 
approximately 15 billion a year, 1.25 billion per   month in their contract from Anthropic. That by 
itself substantially increases AI segment earnings   for 2026. And just this week, 3 days ago, SpaceX 
ins space X inked a 32-month deal with Google for,   I think, 920 million, nearly a billion, rounding 
up, per month. This now secures a total of about   27 billion per year in these lease agreements, 
making their AI division potentially the most   profitable. Well, potent, it's going to have 
the it appears that it'll have the highest in   gross revenue at the very least. if it's not 
the most profitable. That part we don't know   yet. So Q1 2026 um this was before announcing um 
some of these new um agreements. Connectivity uh   represented 68% of their profit. Space continue to 
operate a loss. AI continued to operate at a loss.   The problem with the Q1 2026 is that it shows that 
operating losses were actually increasing versus   2025. Um and and since inception right now this 
25-year-old company which SpaceX is has lost about   $37 billion. So in total they have lost a lot of 
money. So you could say lost but the they've been   investing it strategically reinvesting it in uh 
research and development. So now just to do the   comparison a lot of people are doing right now 
fiscal year 2025 Nvidia brought in $130 billion   of total revenue. So more than 5x the the revenue 
of uh 6x the revenue of SpaceX, but they produced   $72 billion in net profit. Nvidia is a cash 
cow. They are spending off so much profit it   is unbelievable. And they have a $5.3 trillion 
market cap. A PE ratio of 33. Shares outstanding   are 24 billion. The float is about 23.24 billion. 
The price is around $220 a share. So big picture,   SpaceX does 22% as much revenue as Nvidia. All 
right. So if SpaceX were just a mini Nvidia,   then the market cap would be about 22%. So you 
know, if all things were the same except that   SpaceX is not profitable. It's not operating with 
the same profit margin. So if all things were the   same except that SpaceX is losing money, then not 
only would it be priced with a market cap of 22%,   it would be much lower than that. So you're 
talking just on that kind of comparison that   SpaceX would easily be trading only at like $50 
a share, but the IPO price is $135 a share. So   there's a big premium here. Where's that premium 
coming from? People are buying SpaceX not because   of the current business model alone. Yes, Starlink 
is awesome. Starlink is a good business model.   How big can it get? I don't know, but it's pretty 
big and it doesn't have anyone close to competing   with them. So, it's it's it's working. Space, 
well, it supports space. It supports Starlink,   so it's an important part of the business. Um, and 
it has future potential as well. whether or not   we're gonna have data centers floating in outer 
space, you know, that that I don't know that that   type of thing seems like it's um it's it's a far 
wish list and it's very far removed from where we   are right now today. So to value the company 
based on that happening seems like a little   bit of a stretch. equally to value it based on 
colonizing Mars. That's so far away to be expected   to pay that multiple in value today seems a little 
unrealistic. But again, if you're if you're basing   this investment on uh Elon Musk that you believe 
that this person is inc is capable of incredible   things, then you want to be a part of SpaceX. So 
the valuation problems right now um they said in   their filings that the total available market 
for AI segment is $26.5 trillion. That's just   that's for the AI segment. But there's a little 
bit of a problem with that that a lot of people   are pointing out. Grock does not dominate in the 
AI segment and even the companies that do dominate   are losing money. So think about it this way. 
Starlink is dominating in space and that gives   them a huge strategic advantage. They're the most 
successful. They're big. How would someone else   compete? It would be really hard at this point to 
to even get an edge in on that that market, right?   Because it's so well dominated by Starlink. Well, 
AI has been dominated by Chat GPT and Anthropic,   you know, Perplexity. There's these other um 
there's these other companies that are that are   doing a arguably well look they're a lot more 
popular. So whether or not you like rock is I   suppose another question because the market is 
speaking for itself or what the market is saying   is that it's not that popular. So if it's not that 
popular, how would it become more popular? Well,   this is kind of an issue right now because a 
lot of these um AI companies that are really   popular are also losing money. So this has been 
a a topic with the Anthropic IPO that people are,   you know, speculating will be uh later this year 
and then OpenAI uh a little bit after that that   uh Anthropic moved to um a different type of 
billing for their enterprise customers and all   of a sudden you've got these enterprise customers 
that have blown through their entire budget of   what they thought they would need for uh for their 
AI systems in a matter of months. and they're   spending an unbelievable amount of money. I I I 
mean I've it's truly staggering when you read how   much money some employees are spending using their 
AI um tools. It's it's more than the employee   makes as their salary. Now, you could argue 
that it could make the employee that much more   efficient, but then you've got to fire a bunch 
of people for that math to add up. So the I I   think that at this point aside from the fact that 
um Open AI and some of the others are beginning   to bring in advertising, Google makes money on 
advertising, right? So sponsored um links at the   top of each search. So you start to get that in um 
AI and that in theory should help pay for it. But   nonetheless, there's a there's a big question here 
at how to make money. And so you could make money   by charging more money, but then if you charge 
more money, your total available market goes down.   Your total available market right now is high and 
the total amount of people that are interested in   using these AI agents and assistants and tools and 
everything else is high because the price has been   artificially kept low because the companies are 
trying to get people hooked on it and then sort of   figure out how they'll make money with it later, 
which is a nice idea as long as they figure out   how to make money on it. So when it comes to the 
valuation, there's the price to sales ratio. And   what this is basically doing is it's looking at 
last year's total revenue and um then it's using   that as the as the the ratio or as the multiple to 
figure what the market cap should be. And so when   we look back at some historic IPOs and I I took 
a you know a se selection of a few of the bigger   ones, you can see what their current revenue in 
the previous year was compared to the market cap   at the IPO. So right now SpaceX um they're trying 
to raise $75 billion. They've got 18.7 billion in   revenue and they're at a IPO uh market cap right 
now of about 1.77 trillion. That's 95x. That's a   ext that's an extremely high ratio. You look back 
at some of these other ratios, Robin Hood 30x,   Coinbase 50x, Door Dash, Airbnb, Facebook, Meta, 
Google. You go back to Amazon back here. Amazon   in 1997 when they IPOed their market cap was $438 
million and they raised only 54 million in their   IPO. They raised $54 million in their IPO. The 
previous year they'd had $16 million in revenue   which is kind of crazy numbers when you think 
about 54 million all the way here to 75 billion.   That's a lot. 75 billion. Now raising 75 billion 
by itself is one big number to get your head   around and okay so compared to the preIPO revenue$ 
18 billion to 75 billion you know that's not too   uh dissimilar from 16 million here to 54 million 
right I mean in terms of a ratio but what is very   different is the market cap right here these are 
ext these are very different market caps so today   What we're seeing is that um investors evidently 
are putting a exceptional premium on all the   things that SpaceX could do or may do. And so 
I think that this creates a little bit of a   challenge if you're thinking about buying SpaceX 
at the IPO and holding it for the next 10 years,   which I'm sure many people are thinking about 
doing. But at its current valuations, investors   essentially are being asked to value SpaceX 
today as if it were the leader in AI and it were   profitable. But it's not because AI represents 
the majority of the total available market for   that's that is um created that is sort of the 
substantiation for why the market cap is as   high as it is. And so I think you know this is 
something that again I'm just I'm not I have no   position in SpaceX right now. So, I'm just sharing 
with you my interpretation of what I'm reading in   the filings and what I've read in news articles 
and, you know, watching interviews and things   like that. So, in my my gut feeling is that uh 
well, I'm going to hold off on that because we're   going to get into that in a second. All right. So, 
now let's talk about the innovation argument. So,   you don't want to underestimate Elon Musk. These 
were solar electric cars of the 1990s. And I don't   know if any of you guys went to school in the 90s, 
but I did. And I remember these solar powered cars   coming to the school and they would show them off 
and they looked absolutely ridiculous. This looks   like a horseshoe crab. These are the silliest 
looking cars. It's a bicycle on wheels with you   know a giant array of solar panels and they're 
like this is going to be the future electric   cars and everyone laughed at them. [laughter] 
You know they couldn't drive uphill on their   way out and they would get stuck in the snow or 
whatever. So this was the 1990s and as we know   Elon Musk has been certainly um responsible in a 
large part for making electric cars as popular as   they are hybrids and pure electric cars now are 
nearly one in four cars in the United States. So   something that at one time was unimaginable has 
now become commonplace. And I say that because   he's already doing that with SpaceX in the space 
division, right? the space segment has done the   unimaginable. They figured out how to reuse these 
rockets and they're they're innovating at a level   that NASA and you know other countries haven't 
been able to innovate and these countries you know   I mean it's it's kind of it's kind of unbelievable 
how much they've been able to do and so this is an   argument for the private sector over um you know 
the the government trying to do this stuff but I   don't want to underestimate the Elon Musk factor 
so you're betting on the jockey not the horse here   but uh SpaceX is not without as I said potential 
headwinds. So the first is that the company is not   yet profitable as a whole. The AI segment um yet 
it does have profitable contracts but with short   notice um cancellation clauses. So those short 
notice cancellation clauses mean that what is   currently an extra$ 27 billion roughly of annual 
gross revenue uh could fluctuate fairly quickly   inside of a quarter within 90 days. They do have 
the telecom style regulatory risk for Starlink   ongoing and heavy heavy R&D and capex. That's just 
part of the business because launching satellites   into space and you have to maintain them and 
everything else. And then they've got the insider   lockup expirations that will increase the float 
and the supply and we're going to get into that   when we get into the technicals because that 
is a it's a more nuanced component of this IPO   but it is very important. So, let's go ahead and 
transition to talking about the technical elements   of the SpaceX IPO. I am a technical trader. This 
is the area where I really shine. And I'm going to   give you a bunch of examples of other IPOs that 
have been hyped up. Um, generally when it comes   to fundamentals, I I look at them enough to have a 
kind of big picture understanding of the company.   And and this is specific in the case of a hyped 
up IPO. I wouldn't do this on any old stock I   might be trading for a matter of five minutes. But 
for a hyped up IPO, I I try to look into it and   understand it as best as I can. Um, but at the end 
of the day, my job will be to trade the volatility   and to trade the price action that's right in 
front of me. My trades can be as short as minutes   long, even seconds long on a really fast trade. 
So, at that point, I sort of put the fundamentals   aside. But looking at the fundamentals is 
important because it helps kind of um it gives me   insight into what I can expect to see in the price 
action. Sometimes when I don't understand the   price action, I go into the fundamentals and then 
I see something and I'm like, "Oh, that's it. Why   is there so much selling on this stock? Oh, they 
they're doing an offering with this, you know,   underwriter and that underwriter is known to 
be very aggressive selling direct on the open   market." Okay, that all of a sudden adds context. 
Or why is there an incredible amount of support   for this company? Oh, it's getting included into a 
giant ETF like the NASDAQ 100. That's an important   thing to be aware of. So, first let's talk about 
how hi hyped IPOs typically trade. This is Airbnb.   It went down 50% versus the IPO day. All right. 
Now, not immediately, but as you can see here,   we IPOed on Airbnb and that day was a red candle. 
The price dropped down. It spiked up and then it   closed a little bit lower. I traded it. I made 
money on it and I was in and out of it within less   than 15 minutes. The next couple days it sells 
off. It rallies back up. It dips down. Rallies up   even more. Pulls back and then kind of stabilizes 
here before selling off. Comes back up a little   bit later uh in the in the year. And then, you 
know, two years later, it's down about 50% versus   the IPO high. So this is a fairly uh significant 
draw down. Now I share this with you just as one   example. Here's a second example. Door Dash down 
68% versus the IPO day between the high here and   the low down here. So this one I also traded and 
made money on on the initial IPO day which as   you can see here had about 180 million shares of 
volume. If we look at the volume just go back real   quick. Um Airbnb did about 70 million shares 
of volume. So oh sorry this is the Uber. Um,   sorry. This is this is Dash. So, let me just uh 
you know what? Yep, that's right. So, we're going   to look at um Uber. Forgot to just update the 
name. Sorry. On that slide. So, this one's Uber.   This one is Dash. So, we'll do Dash first, then 
we'll go back to Uber. So, Door Dash. So, this   was and I did trade Door Dash and I also traded 
Uber. So, all of these I trade on day one. So,   uh, Dash did about 32 million shares on day one, 
sold off, came back up, sold off, but within, you   know, as it turned out, a year, year and a half, 
it was down 80% here. Way, way down, $40 a share   versus these highs up here, which were 260 bucks. 
That's not good. Going back to Uber, this one,   um, down 68%. So, the IPO day, it never really got 
higher than that. took a long time, but it sold   off all the way down to about $15 a share before 
coming back up to 60. So, when you look at some of   these previous IPOs, I want you to think about 
your bias or what you think might be the right   thing to do if you want to invest in SpaceX. So, 
if you wanted to invest in Airbnb, for instance,   where would be a good time to be a buyer? Well, 
certainly not up at the very top and probably not   on the IPO day because it dropped down and then 
came back up. Maybe down in these areas after we   double bottom support down here, back up here, you 
know, maybe down in this area after that level of   support or maybe just in this area when it started 
trending back up. What about Uber? Well, again,   not on the IPO day. Um, after it found some degree 
of support and was trending back up, you know,   maybe through this area here it starts to get more 
interesting, but even then comes back down a bit.   Um, Door Dash, you know, initial IPO day 
sells off, rallies up strong, then sells off,   comes back up again. Now, it's been beaten up 
for a long time, down 80% versus the IPO day.   What about Robin Hood? Robin Hood's interesting. 
A very strong IPO. Look at that. It IPOs and in   three days goes from $32 a share to 88 bucks. 
Now, they IPOed at just the right time. In a way,   in a way they did because it was tied right in um 
with, you know, all the momentum of the pandemic.   But on the other hand, they were also many people 
felt responsible for the GameStop short squeeze   not working out the way it was should have. So I 
don't know. But in any case, um the price came all   the way down here down to 78 a share before you 
know it's rallied up since. But just for context,   Coinbase IPOs and just tanks. All right. So this 
one not very good. Dropped 93% versus the IPO high   from there down to here. Rivian 90% versus the IPO 
day. Did move up for a couple days and then it's   just been coming back down since. Circle IPO. 
Um, now this one's a little bit different. So,   um, the Circle IPO is, uh, was very strong. This 
one was last year and it IPOed at like $40 a   share. I traded it on that day, made some good 
money on it. I think it was around $30,000 and   then over the course of the next few days, it ends 
up going up 300%. Which was crazy. Uh however,   it had a relatively low float for IPO this big, 
subject to a lockup period where insiders couldn't   sell. Uh but then eventually reality sets back 
in and now the price is back down around the IPO   level. So what's different about SpaceX from these 
other IPOs? On the one hand, you might think,   well, geez, it seems that IPOs are kind of risky. 
they IPO and some of them go up a little bit for   a week or two, but more often than not they 
seem to drop quite a bit. Um, so number one,   we've got the float. SpaceX is selling a very 
limited number of shares versus the number of   shares outstanding. So to raise 75 billion, 
they have to sell about 555 million shares at   $135 a share. But that represents less than 
5% of the shares that are outstanding. So if   we jump onto the whiteboard here, we've 
got 5% right here, which is the float,   and we've got 555 million shares. And then we've 
got the whole rest of the pie, which is SpaceX.   So, what's really interesting here is that these 
555 million shares when we're trading it on the   open market are essentially determining the 
valuation for all of these shares. And there's   something like 12 or 13 billion shares. So, all 
of these shares get their valuation from the   supply and demand of just this little tiny piece, 
which is 555 million. that that seems a little   um it seems like that could present a problem 
at a certain point and and I think it will,   but the remaining shares are restricted by 
a lockout period or a lockup period. So,   they can't be sold at least immediately on the 
open market. So the early lockup release period is   going to potentially increase the supply from 555 
million shares to closer potentially um to about   7.5 billion shares. So that is substantial. 
approximately 7.5 billion shares are going   to be eligible to be coming onto the market and 
become part of the float within the next 6 months   approximately and that's based on this lockout 
schedule or lockup period schedule which is from   um the S1 filing that um SpaceX filed and so the 
release is in these um kind of tanches so it's   staggered so they're not all hitting the market 
at once but over the next 70 90 120 between 135   and 180 days, these shares are going to be uh 
eligible to be sold on the open market. So,   who owns all of these shares? Well, these shares 
that are going to be eligible are shares tied to   some of them are going to be tied to Twitter, 
people that uh investors that bought Twitter,   and others are tied to people that were early 
investors in SpaceX. SpaceX is not a young   company. They've been around for 25 plus years. 
So there have been investors, I think there's   been 20 rounds of investing over the past 25 
years. In other words, if you were wealthy,   you have had every opportunity to buy into SpaceX 
long before the IPO. In fact, the only people that   really are getting access to the IPO to SpaceX now 
for the first time in this IPO are, dare I say,   dumb money retail traders like you and me. It's 
not sophisticated investors. They've already had   so many opportunities to get into SpaceX. And so, 
in fact, the day of the IPO, the day of the IPO,   when this is publicly trading at $135 a share, 
it will be the highest valuation that all of   these shareholders and 42% approximately 42% is 
Elon Musk and his shares are also restricted. Um,   but uh it'll be the highest valuation they've 
ever had, which is what's going to make Elon   Musk the world's first trillionaire. Incredible. 
Incredible. Um, uh, and again, it's it's on paper   because if he wanted to sell his approximately 
5.5 billion shares, which he's not eligible to   sell them, but if he wanted to sell them all, the 
market wouldn't be able to sustain that selling.   There won't be enough buying to buy 5.5 billion 
shares in one day. Even if he wanted to sell them,   it would be impossible. Right now, could he do a 
swap with some institutional investors who want to   take a big chunk and maybe at a discount, blah 
blah blah, whatever. But he would not be able   to sell them on the open market. But you can see 
that with his staggered release schedule, insiders   who have held shares for a number of years, some 
maybe more than a decade, will be able to start   selling on the open market. This is an important 
dynamic to understand in the relationship between   supply and demand because this has the potential 
to drastically increase the supply. So now will   there be enough demand to absorb all of these 
shares without the price tanking? Will there   be enough confidence from insiders to agree not 
to sell their shares because of what they know   it would do to the stock price? Maybe. Maybe 
a lot of these insiders are along for the ride   and they're not going to sell any shares. But if 
they represent investors underneath them, it's a   hedge fund or something like that, you know, they 
will likely have to begin selling some shares at a   certain point. However, SpaceX negotiated with 
NASDAQ when they got their listing and NASDAQ   changed their rules to allow SpaceX to become part 
of the NASDAQ 100 as of day 15 after the IPO. and   SpaceX will be waiting the waiting is estimated to 
be between47 and 7% of the total fund and that's   uh what that's essentially going to mean so 
number one a lot of people are finding this to   be controversial that NASDAQ changed its rules 
uh essentially to get the listing from SpaceX   and other people are saying well look if you're 
investing in a fund an ETF you want a piece of   the entire market and SpaceX is part of the market 
granted its waiting is less than 1% of the total   fund. So if you want some exposure to SpaceX being 
one of the largest companies in the world, then   you want it in the fund. But what it means is that 
all peop everyone who's invested in the NASDAQ 100   uh and the funds that are investing in the NASDAQ 
100 will be rebalanced to include SpaceX. This   will result in a one-time event that will create 
significant buying support for SpaceX because   the fund will have to purchase SpaceX shares 
on the open market. And then moving forward,   anytime someone buys part of that ETF, they'll be 
getting a small sliver of SpaceX. So that's going   to create a degree of long-term support, which is 
naturally probably one of the reasons that it was   uh something that was so important for the SpaceX 
listing. Now, SpaceX also was petitioning the S&P   500 to include SpaceX, but they did not get that 
request approved. So, currently the S&P 500 has   a 12-month seasoning period for an IPO, and it 
requires profitability over the four most recent   quarters, which SpaceX doesn't currently meet 
because they're losing money. So, as of right now,   uh the inclusion to the S&P 500 is on, you know, 
back burner. It's not going to happen this year,   next year maybe, or 2028, uh at best. But that 
would create additional buying support when it   happens. It'll probably happen, but but we 
don't know. Um, now number five, uh, are the   Twitter and X investors. Investors of Twitter 
and X became shareholders of SpaceX. And these   investors may end up selling shares when their 
lock up lock up period expires. They may want to   cash out. They've gotten most likely a fantastic 
return on their investment. So, you know, that's   that's another variable. Now, something else that 
um I haven't mentioned, but is the discussion of   SpaceX doing some type of merger with Tesla and 
creating a gigantic company. The motivation to   do that potentially would be that Elon Musk is 
in complete 100% control of SpaceX. He's in he's   he his voting rights give him complete control 
over all decisions. He can never be fired. And   so he could take this current opportunity with 
the amount of hype around SpaceX to do some type   of merger with Tesla and roll Tesla into SpaceX, 
which would create a, you know, ultra big company.   But the details of how that would work and what 
that would mean for current Tesla shareholders   um and and SpaceX shareholders is, you know, all 
speculation. Number six, this is very important.   Retail allocation. typically hyped up IPOs, uh, 
retail traders like you and I, we could request   shares through our broker. If you use Erade or 
Schwab or Robin Hood, you could request to get   access to shares and you almost never get them. 
But with SpaceX, Elon Musk has allocated 30% of   the shares in the IPO to go to retail traders. On 
the one hand, you think this is awesome. you know,   this guy's looking out for the the little guy, 
the retail trader. On the other hand, you know,   we're uh known as the dumb money. And so what I'm 
noticing here is, and I'm just kind of doing the   math here, 30% of the IPO for retail. It's over 
20 billion for retail. I mean, we've we've got,   you know, none of us have that much money in 
our pockets individually. Um it's more than   150 million shares. So, what I'm seeing right now 
is that brokers are coaching their customers on   how to request access to shares. I'm seeing it 
all over the place, all over social media. Uh,   it's unbelievable. The CEO of JP Morgan um is 
hosting a special meeting for high- netw worth   clients to discuss SpaceX. So, there's a it 
seems like there's really big broker support   to encourage sort of your typical investor to 
buy into SpaceX. Um, I've been seeing a lot of   that. And so, Robin Hood, just to break down the 
numbers, has about 26 million accounts. Of them,   3.48 million or about 13% are gold users. I am 
a gold user at Robin Hood for my account. A gold   user means you have access to margin. And um, so 
almost any active trader would be a gold user,   which means only about 13% of their users would 
be what at least I would consider to be an active   trader. And Robin Hood seems to be like that would 
be the most one of the more active brokers because   you don't invest you don't put money in Robin 
Hood, you know, as a grandmother who's doing like   wealth management, you know, that's not what Robin 
Hood's for. So arguably Robin Hood probably has   more than three and a half million accounts that 
are interested in the SpaceX IPO. But right now,   if we just thought about the number of their 
accounts they have that are active gold users   and active traders by default, in my opinion, it's 
about 13%. Schwab has 46 and a half million client   accounts. But there's no doubt the vast majority 
are retirement and wealth management accounts. How   many of their accounts are actually active traders 
in the market? Active discretionary investors,   you know, buying and selling stocks in their 
own account. Interactive Brokers has 4.4   four million accounts, but it's a more 
sophisticated broker, right? So, more   sophisticated investors and traders are there. 
Fidelity has 50 million accounts, but again,   dominated by wealth management and long-term 
investors. So, what I was trying to figure out   is how many retail investors do we really have out 
there that are interested in buying SpaceX? And   just looking at these top four brokers, um, using 
the 13% uh, kind of ratio that Robin Hood has, I   figured if Schwab had 13% that are pretty active, 
that would be like 6 million accounts. You know,   for interactive brokers, I said maybe 75% are 
active because that by itself is a more active   broker, but I don't know that. And then Fidelity, 
maybe only 13% again. So that's a rough number   of let's say 25 20 million accounts. Now, I 
could be way off right there. I I don't know.   I don't know how many are active and we don't have 
this information. So the information that I got   from Robin Hood is straight from their filings 
and I'm getting this information from filings   but I'm having to extrapolate uh what might be 
the amount of active accounts because they don't   share that exact metric and they probably keep it 
I don't know they just don't want to share it. So,   if we just had 20 million active accounts, well, 
now I'm thinking if 20 million active accounts all   requested shares and you know I there's I don't 
know I I I can't really imagine that there are   20 million well but I don't know maybe there 
are let's just say 20 million um maybe there   are maybe 20 million active accounts have all reg 
have all asked for shares. Each account would get   eight shares that's $1,000 worth of stock at $135 
each and that would use up the 160 million shares   allocated for retail. eight shares each. So, you 
know, I don't know is the is so what does that   mean for demand? Is there going to be such a 
high level of demand? Now, one thing I would   say is what you could do is you could request 
shares and then the day before the IPO, they'll   tell you whether or not they can get them for you 
and how many they can get and then you confirm it.   I'd be curious if everyone puts in a request and 
we all get the like all the shares we ask for,   that tells me they've got a lot more supply. If 
we only get a few of the shares, let's say you   ask for 100 and you only get two, then it's like, 
wow, demand is really high on this thing. We won't   know till Thursday before the IPO. But if we only 
get a small number, then we know that the demand   is really high. And that means people didn't get 
the number of shares they wanted. And that means   when will they buy it? the day of the IPO. But 
if you get all the shares you want ahead of time,   then you don't really need to buy it on the day 
of the IPO. So, what about retail flippers? How   much less buying will we see on the IPO day since 
retail traders will likely have access to possibly   as many shares as they want prior to the IPO? 
Now, this is again speculation because we don't   know yet. But will retail traders just flip out of 
those shares for a quick profit if the IPO opens   above 135? Because what typically happens with 
a hyped up IPO is the IPO price is $135 a share,   but it opens for trading on the day of the IPO 
already up 15 20%. That's not uncommon at all. So   the IPO price of $135 opening at 1451 150 even 160 
or 175 wouldn't be insane. If it opened at 175,   you would have a natural price target of $200 
a share on day one. You would logically think   that way. Even though this is a huge company, 
that's the way traders think in these big round   numbers. If we open below 150, 150 is the first 
target. We open above 150, 175, 175, up to 200.   So that has the effect potentially of increasing 
the market cap on SpaceX from 1.77 trillion to   upwards of two a.5 trillion on day one. And yet, 
who could sell on day one? Well, maybe some of   these retail traders who are flipping. Now, some 
brokers will restrict you from flipping shares,   they'll make you say that if you're going to take 
the shares, you've got to hold them for a minimum   of 45 days. So, you've got to make sure you read 
the fine print when you accept the shares. They'll   tell you if you have that that restriction. So, 
some brokers frown upon flipping the shares,   getting them at the IPO price, and selling them 
on like day one or day two. They don't want you   to do that. Others don't care. So, look into that. 
But given that there will there may there may be   some flipping, there probably will be. Some people 
will say, "I don't care. I'm going to flip anyways   and so what? I don't get any future IPOs with this 
broker. Big deal." You know, I made $10 a share on   a thousand shares. I made $10,000. It was worth 
it. So, what typically happens on the IPO day is   it opens quite a bit higher. And so, I expect that 
with SpaceX because that's what typically happens.   But part of the reason that typically happens is 
because day one is the very first opportunity for   retail traders to get a piece. It's the very first 
chance and there's so much FOMO. In this case, it   may not be the first chance if retail traders have 
already gotten all their shares allocated. So,   please leave in the comments below if you request 
shares, if you got them, and how many you got.   This is going to help everyone else who watches 
this episode better understand what the supply   demand is looking like going into Friday. So, you 
can help everyone else here on this channel by   just posting that and telling us kind of what you 
experienced. And I'm going to do it myself. I'm   going to try to request it in my uh Schwab account 
and I'll see if I can get any. I I guess I could   try my Robin Hood account, too, but it doesn't 
really have any money in it right now because my   small account challenge is only got a couple 
thousand dollars. So I don't I I don't think   that would be a very useful indication. So will 
I trade SpaceX on day one? The answer is let's go   back. Let me run that one more time. Will I trade 
SpaceX on day one? The answer is yes. Cautiously   long bias. I think realistically an investor would 
have to be outside of their mind to short SpaceX   on day one knowing that the NASDAQ rebalancing 
is coming on day 15. You'd have to be out of your   mind to short into this retail mania. I'm going 
to say something. You might not like Elon Musk.   You might not agree with him and what he's done 
and politics and whatever, whatever, but when   you stand in front of a moving train, you get run 
over. The valuation, the the fundamental valuation   doesn't always make sense. The stock can keep 
going higher. We've seen this across the board   in all different markets. And so SpaceX, if it's 
the type of stock that's structurally set up to   succeed because of the limited float, the lockout 
period, and the inclusion in the NASDAQ 100, I'm   not going to stand in the way of it succeeding. 
Now, if it doesn't succeed, I'll be surprised,   but I would not be shorting it on day one. That 
would to me be insane. I also don't know that I   want to buy it and hold it for 15 days because 
it could be highly volatile. So, I am cautiously   long biased, but I am recognizing that what's 
different with SpaceX is the retail allocation.   That is the biggest difference to me because 
it could affect the amount of demand on day one   and it could create selling that we wouldn't 
typically see on day one. But realistically,   I think we're going to have strong buying support 
through at least the first three weeks of trading   until the lock up lockout periods begin and then 
until the lockout periods begin to expire. So,   the first lockout periods are coming in um I 
think it was August, if you just jump back to that   slide. And I wouldn't it wouldn't be surprising to 
me if going in to that kind of cliff where we're   going to start seeing insiders have the ability 
to sell if there will be people that are shorting   into that expecting this increase in supply to 
potentially come onto the market because I don't   know if there will be enough daily buying volume 
to support when they decide to start selling and   we don't know when they're going to start selling 
but it wouldn't surprise me if the chart ends up   looking something like this IPO day right here and 
we move up steadily for 15 days and this is I'm   not investment advice I'm just making you know my 
my educated prediction based on educated intuition   so we move up for 15 days maybe we move up for a 
month one month and then what's going to happen   is as we approach Q2 earnings if the stock is up 
30% then 7% of the shares are going to be unlocked   based on this achieve achievement right here 
and that's where we begin the cliff of unlocking   shares right here. And so as soon well it's it's 
going to it would start you know right about here.   So once we're coming to that spot that's where I 
would expect some more institutional level short   selling to occur as they're betting that these 
insiders are going to take profit and that's   where I would worry about a sort of steady stair 
stepping down and it wouldn't shock me at all if   we go below the original IPO price. It wouldn't 
shock me. I would not be surprised considering   what we have for historical data that supports 
that the majority of big IPOs end up going   uh let's see where was that slide. The majority 
of big IPOs end up going down versus their IPO   price. Where was that? Um so this was the slide 
where I was saying um would I trade it and then   would I invest in it? So here um what we know from 
historical IPOs is that typically typically you   have the IPO at best you have this is this is the 
more typical IPO you you IPO the price goes up and   then it begins a downward decline and we have seen 
declines as much as 90% before they rally back up.   Now if we pull up the the chart on Robin Hood here 
just for a second you want to be a trader here   that's fine but look at the selloff. where was the 
right time to be a buyer on this? And it's after   it's stabilized at some point and then you get 
this nice recovery. So, what we know about these   big IPOs is that they're usually priced high. 
They're really they're really hyped up. They   open high and then they have a period of selling 
off. So, this has been true with pretty much every   single one of these IPOs right here. Um, and I 
guess let's see, let's check Airbnb because I   actually think that we did go below the IPO um 
price, but let's just double check that. So,   Airbnb. Um, so Airbnb, let's see. No, maybe not. 
So, you know what? Yeah. So, this is the thing.   Airbnb was super hyped up. Even though their 
price was like was low, they ended up opening   super high and then pushing higher, but it still 
ended up dropping sub substantially before it's   come back up. So, none nonetheless, buying on the 
day of the IPO uh wouldn't have been necessarily   a good idea. And I think this right here speaks 
to um a little bit of a bigger question in the   market which is why is it that companies are 
waiting later and later to IPO? The answer is   because they're raising money with venture 
capital. They're raising money with private   equity and they're coming to the market later and 
later. So the problem here is who's missing out?   Who's losing? Well, let's look at some of these 
companies. So, Apple uh IPO price is $22 a share   and um the market cap um at the IPO 1.8 billion 
which is not insignificant 122 million shares or   million dollars capital raised and the return 
is 2500x Microsoft 4,000x Amazon 6,000x. These   are huge returns on the public markets if you are 
a buyer basically um at the IPO price. Google a   little less. Facebook 15x a 15x return. IPOed at 
38 valued at 104 billion dropped to $17 a share   and then rallies back up 15x. Airbnb right now 
not a big return you know mar marginal. Door Dash   not a not a big return. Coinbase, I mean, no, not 
at all. Robin Hood, okay, now it's doing better.   Rivian, you know, again, it's the problem. And so 
SpaceX is to be determined. So how would you get   a big multiple on SpaceX? So the the issue here 
is that these venture capital, private equity,   um, investors are getting in before the public 
markets. And in my opinion, it's unfair for retail   traders because, you know, retail traders, we're 
just getting the final scraps. In other words, the   day of the IPO will be a huge payout for venture 
capital, private equity, for the people that were   in early, and we're just getting the scraps. We're 
just getting the very end. So, in order for retail   traders to get a 10x return on SpaceX, it needs 
to go to a nearly 20 trillion market cap. Come on,   that's outrageous. We've missed the boat. 
We've completely missed it. All the big money,   all the wealthy people, they already got their 
piece of it. And are we just exit liquidity so   they can sell? I hate to think that way, but 
it feels that way. It feels like SpaceX ran out   of money in the private sector and had to IPO. 
Maybe p maybe insiders were ready to cash out.   So higher ROI for active traders, at least in 
my feeling, in my experience right now would be   um sympathy stocks, space theme stocks. So this is 
a space theme stock. Just last week, I made about   $75,000 on this stock. It went up a,000% in three 
days, 10x in three days. They put out a headline,   and this headline was juicy. They knew what they 
they knew absolutely knew what they're doing.   SpaceX synergies, satellite and AI data centers. 
They put everything into this headline. I mean,   they word smith this thing like crazy. The stock 
went up a,000%. This is another one last week,   the week before. ASTC went up 3,500% in one 
week. They put out a headline once again.   Boom. Infrastructure initiative to advance future 
moonbased quantum computing manufacturing. What?   But this to me feels like where there might be a 
lot of opportunity. So, I'm going to let SpaceX   be the whale. I'm going to let that be the big 
boat that's rocking all the ships in the harbor,   and I'm just going to be the little fish riding 
in its wake. And maybe I get a little piece of   SpaceX on the day of the IPO. Maybe I get a trade 
on it. That I don't know. We ultimately, you know,   we'll see. I might, maybe I'll buy it and hold it 
for a couple days. I don't know. But what is most   likely is that I make a lot more money on sympathy 
stocks that are sort of riding the coattails of   SpaceX. And I think that's where there's a lot 
more opportunity. None of this is without risk.   You guys know that I'm sharing everything with 
you just for educational purposes. I'm a trader.   I'm actively trading every day. This is my weekly 
watch list. This is the game plan. I'm going to be   watching SpaceX, but I'm really watching any stock 
that comes out with a headline that's space theme.   This is the new headline right now and it's it's 
something to pay attention to. So, for those of   you guys that enjoyed this deep dive into SpaceX, 
I hope you number one hit the thumbs up. Number   two, subscribe to the channel and if you want 
to watch me trade, including watch me trade the   SpaceX IPO this Friday, June 12th, you could check 
out a two-eek trial at Warrior Trading. That'll   give you access to the software that you've been 
watching me use here in the background. Um, we,   uh, this is software that I've built out over the 
last, uh, well, since 2017, so nearly 10 years,   rounding up a little bit. Uh, it's software 
for charting, for scanning, breaking news,   and we have chat rooms in here, and I have a live 
audio video broadcast where you can hear my daily   market commentary as I share with you all of my 
years of educated intuition about what's happening   in the market. And I show you my P&L in real time, 
so you can see if I'm getting in or if I'm getting   out, and what I'm doing with my positions. So, 
hope you guys check out the twoe trial. Hope   you enjoyed this episode and I'll see you for the 
next upload real soon. If you haven't, by the way,   checked out my brand new small account challenge. 
I'll put a link to that episode right up here. So,   check that out and I'll see you guys. I'll 
be streaming tomorrow morning at 7:00 a.m.