SpaceX IPO: Everything you NEED to Know to Get Ready!

What's up everyone? All right, so in today's 
episode, I'm going to share with you everything   that you need to know to get ready for the SpaceX 
IPO. It will be the biggest IPO in history,   and there is no question about it, it will be very 
volatile. It will be exciting to watch and it'll   be exciting to trade. So whether you're thinking 
about trading it, buying and selling actively,   day trading it during the day of the IPO or the 
days and weeks just after, or you're thinking   about investing in SpaceX for the next 10, 
15 years, like maybe you wish you could have,   should have, would have with Tesla, Nvidia, and 
so many others. I'm going to share with you what   I think are the most important things to consider 
before trading or investing in SpaceX. SpaceX is   not your typical company. I mean, it's it's not. 
In fact, SpaceX has the potential in the weeks   following the IPO to become the largest company 
in the world, the largest publicly traded company   in the world. That that is unbelievable. 
It has the potential to become larger than   Nvidia. Whether or not that will happen will 
be a matter of the price action that follows   in the days and weeks right after the IPO. But 
because of the way this IPO is being structured,   there's a much higher likelihood that we see a 
lot of momentum and a big squeeze right after the   initial public offering. I'm going to explain why 
as we jump into this class. All right? And this is   a class I teach lots of videos on YouTube. I teach 
videos to members in our community over at Warrior   Trading. And for those of you guys who are tuning 
in for the first time, I'll just briefly introduce   myself. My name's Ross Cameron. This is my screen 
as you could see right here on screen share. We've   got a slide deck. We're going to go into the SEC 
filings. I've got my software on the back right   here looking at Tesla. I've got Nvidia right 
up here. And I am a full-time trader. I funded   my first account in 2001, more than 25 years ago. 
And I'm probably best known for turning an account   with less than $600 into over $20 million of 
profit. I don't want you to assume that my results   are typical because they're not. But I would like 
you to know that you're not just listening to an   armchair quarterback on the news who has no skin 
in the game. I'm actually trading every single   day and I will be trading the SpaceX IPO and I may 
be investing in it as well. That's something that   we have to consider. I'm going to walk you through 
the way I'm thinking about it in this class. Okay,   so SpaceX just filed their um S1. This is the 
registration that gives them the right to sell   new securities. And so any company doing an IPO 
has to file an S1. and the S1 has to file has to   follow a certain format so it's easy for investors 
to compare different S1s uh to each other. Um now   SpaceX has deviated from that a little bit in that 
they've shown on page three a rocket ship. Um page   four another rocket ship. Page five a beautiful 
picture of Starlink which we'll definitely be   talking about. I mean this is very colorful. 
It's very these are fantastic photos. Great   photographer. whoever is doing this, well done. 
Um, not what you typically see in SEC filings,   but SpaceX and Elon Musk do things differently. 
And so, this is definitely going to capture   people's attention, will probably be discussed 
a little bit. Uh, but in any case, you get past   all the pictures and then you get to this table of 
contents which walks you through risk factors that   the company is facing. They disclose uh pending 
litigation, things like that. Um they'll walk   you through the financials of the company and 
they'll walk you through the share structure of   the company. Who owns the most shares? One should 
be surprised. Uh Elon Musk is a 42% shareholder,   will be a 42% shareholder after the IPO and um 
will be in control of all voting on the board of   directors because of the ownership of extra shares 
that have more voting rights. So he is in total   control of this company. He will not be allowed 
he will not allow himself to be in a position   where he can't make the ultimate decision and all 
of that has to be disclosed because you need to   know that as an investor going into this company 
that control is very concentrated among uh well   just one individual person here really. So let's 
go ahead and jump onto this slide deck because I   do have a lot I want to share with you and I want 
to try to be most efficient in use of time. I will   have likely follow-up episodes as we get closer 
to the IPO and we get more information. But this   right now is going to set the stage for what will 
be the biggest IPO in history. And so all traders   are certainly going to be thinking about this, me 
included. We have two schools of thought here. The   story with SpaceX. On the one hand, we've got the 
fundamentals that investors typically care about,   which are important. They help us understand and 
it helps support the current uh IPO price. And   then we have the technicals that active traders 
like myself really care about. And as I mentioned,   the way this IPO is being structured is a 
technical component and that's what giving it   the potential to do something really exceptional. 
And that's what I'm pretty excited about. So big   picture, the S1 um disclosed the revenue of 
for 2025 and Q1 for 2026. And so big picture,   uh, SpaceX brought in $18.7 billion in 
total revenue last year and operated with   a net loss of $4.94 billion. Connectivity 
broken down into the segments that the uh,   business operates. Connectivity, which is uh, 
Starlink, generated 11.4 billion of revenue,   representing 61% of the gross revenue for SpaceX. 
And it generated a profit of 4.42 billion. And I   think this is something that's really exciting. 
This right now is their bread and butter. This is   their cash cow. It's producing a lot of cash. Now, 
they're taking all of that cash and reinvesting it   into space and AI, which is a strategic choice. 
You can either take the cash, build the cash on   your balance sheet, you can certainly reinvest 
it, but they're reinvesting in the company because   they believe they can make better use of that 
money than any other investment, which is probably   true. But the net result is that the company 
is losing money. In fact, they've lost over $30   billion since inception. So this is a company that 
is currently trading uh in you know in term well   it would have it wouldn't have a PE ratio because 
it doesn't have positive earnings. So when we look   at a company like Nvidia and we'll use Nvidia as 
a comparison it's currently trading at about 33   times um the as a PE ratio. And so when you think 
about a company that you would be investing in,   something that I always think about is if I was 
going to buy the entire company, the whole thing,   not that I could afford it, but if I was going to 
buy the whole thing, how long would it take for   me to pay off that whole company? And often you 
pay a premium when you buy a company. It's well   established. It's got a brand name, everything 
else. And so you might, in the case of Nvidia, be   paying like 33 times multiple, 40 times multiple, 
whatever the case might be. and you figure okay   it would take me 33 40 years to pay off this 
whole company but you buy it and then you think   but if I can increase the earnings then make the 
company more efficient then I'll pay it off even   sooner right so with a company like SpaceX this is 
a little bit trickier because right now you've got   11.4 4 billion of revenue on Starlink with four4 
billion a year of profit and Starlink is not fully   scaled. Starlink still has so much more room to 
grow. Now I personally use Starlink. I have three   Starlink subscriptions. I have them on my cars. I 
have them um on my my Sprinter van which I use for   when I take my boys out on trips in the wilderness 
and up in Canada and Colorado and everywhere else.   Starlink has been phenomenal and the total 
available market for Starlink is huge because   Starlink will be I I really believe this Starlink 
will be the number one internet service provider   globally around the whole world and so the total 
available market is everyone in the world that's   huge. So Starlink has a lot of room to grow now 
again and they've got great profit. So that as a   business by itself would be something that I would 
absolutely invest in. But they're taking all of   the profit instead of keeping it and returning it 
to shareholders in a dividend or something like   that. They're reinvesting into space and AI. Now 
AI is right now their worst division of um SpaceX.   It's uh it's it's losing them a lot of money. When 
we talk about Starlink being the most successful   division, I think something that you have to 
acknowledge is that there is risk. The risk   is that in a different administration, remember 
right now this administration, sort of forget it,   but in a Democratic administration, there's 
no question that Starlink would be at risk of   being investigated for anti- monopoly practices. 
Monopoly practices, it just would be. This is   the issue with investing in telecom companies. 
You invest in Verizon, AT&T. Essentially what   those companies have is a it's a regulated and a 
government approved monopoly. You know when you   move to a town you either get Comcast or you 
know Xfinity or whatever it is. You know it's   it's like there that's the service provider for 
the town. They have a monopoly but the rule with   these government authorized monopolies is that 
the companies have to be paying back the profit   they make as dividends to shareholders. So there's 
a lot of restrictions that come with owning what   is essentially a monopoly and and SpaceX being um 
you know one of the largest companies in the world   is no doubt going to be a target from regulators. 
I mean it already has been but but that's going   to continue and it will get worse in a more um 
and this I should have it be here for billion.   It'll get worse in a more um well in a different 
administration. So that's something to be aware   of. Uh but as we know right now the profit from 
Starlink is being spent on space and AI. In 2025   AI was the biggest loser. However, earlier this 
year SpaceX announced that they'll be earning 15   billion a year in their contract contract from 
Anthropic. This will substantially increase the   company's earnings in the AI space for 2026 
at least their gross revenue. So for Q1 2026,   this S1 filing also disclosed how much they've 
made in the first quarter. So this gives us a lot   of perspective on the financials, the financial 
condition of the company with it with of course   not um excluding some really nice pictures 
again of rockets. Very cool. All right. So   here for 2026 connectivity Starlink 3.2 billion 
in revenue. So on track to be uh an improvement   increase over last year. That's great. Profit of 
1.9 billion. Okay. Looking good. Space revenue 600   million loss of 600 million. All right. So they're 
losing money still. AI 800 million in revenue so   far and and and a deep loss. Now the problem here 
is that for Q1 they have a combined total revenue   of $4.69 billion and a net operating loss of 4.27 
billion. So this shows us that the net losses are   increasing here in Q1 versus all of 2025 and the 
losses since inception are over $30 billion. So   this is a company that's losing money. Now as 
many of you guys know I am often investing well   investing I'm often actively trading biotech 
companies. Biotech companies lose money. They   always lose money until and they put all the money 
that they're raising into research and development   just like what SpaceX is doing for space and 
AI and then all of a sudden boom, you know,   lightning strikes and they've got something 
worth a lot. And to be honest, SpaceX has proven   that they can already do that. They've proven it 
with their launches that they've done, which is,   you know, something that nobody else could do. 
You know, NASA, other government, China, Russia,   no one else could do this. But they were able 
to do both the launch, the landing, the reusing   of the rockets. Incredible. They've done it with 
Starling. You know, I don't know how many of you   guys remember Hugheset back in like, I don't know, 
the early 2000s, but you know, if you had a house   that was up in the woods and you didn't have a a 
hard line, like an actual Verizon telephone line   or a cable line, you couldn't get internet unless 
you used Hughet. And Hughet was garbage. It was   satellite internet. And it was horrible. there's 
no way you could trade on Hugheset. And so when   Starling first came out, I was very skeptical. I 
was like, there's no way. I remember what Huenet   was like. I would not use Starlink. And I have 
been blown away. In fact, the cell phone service   is so bad in the area that I live that I mounted a 
Starlink Mini on the roof of my car. It's plugged   into the cigarette lighter. And so now I I can 
make calls from anywhere. So if I break down   in the middle of nowhere, you know, in a canyon 
road or whatever, I don't have to worry about just   being stranded there. So, you know, now Starlink 
is on United Airlines. How annoyed are you every   time you go on a um you know, a Delta flight or 
American Airlines flight and you you've got no   internet? You know, I'm I'm flying this weekend 
and I'm I assume I'll probably have no internet   and not be able to work because I'm not flying on 
United. it is so annoying in this day and age. So   the total available market for Starlink is is 
huge. Uh so that is doing well but then these   other um divisions of the company are struggling. 
Now just as a comparison let's look at Nvidia. So   Nvidia last year did 130 billion in revenue versus 
the 18 billion of SpaceX and they did 72 billion   in net profit. They have a market cap today of 
$5.3 trillion. They are the biggest company in   the world. They have a PE ratio of 33. They have 
24 billion shares outstanding and the float is   around 23.24 billion shares and the price is 
$220 a share. This is for Nvidia. Now, we're   going to come back to this so keep that in mind. 
SpaceX does about 22% as much revenue as Nvidia,   right? They're they're, you know, they're they're 
22% approximately. So if you thought of SpaceX   as just a mini version of Nvidia, then their 
market cap should be about, you know, a fifth   of Nvidia. The float would be a fifth of Nvidia 
and the price would be about a fifth of Nvidia,   right? So five billion share float and a $50 per 
share price. But that would be if they did that   same gross that 22% gross revenue and also are 
making that same um ratio of profit. But SpaceX   is not profitable. I mean, they have divisions 
that are profitable, but as a whole, they're not   profitable. So from the perspective of investing 
in a company to purchase their future cash flow,   you're not getting net profit at the end of 
each year. So then the actual value of SpaceX,   you would figure, would be even lower if you use 
this traditional methodology. Clearly, people are   not buying SpaceX because of just the current 
business alone. Not to not to say the current   business isn't something that's interesting, but 
instead it's because of the future potential of   Starlink to become the biggest internet service 
provider in the world, the future potential of   space and the future potential of AI and to be 
able to have a stake in whatever Elon Musk does.   Now, he's he's a, you know, controversial at 
times and that can hurt his business as we saw   with with Tesla in 2020, end of 2024 and 2025. 
people were burning Tesla um you know showrooms   or whatever. It was it was pretty crazy. So that 
hurt the stock price. You know the his involvement   in buying Twitter that hurt Tesla. So we know 
that he's a he can be a bit of a wild card but   he's also just on a like level of productivity. 
His output is through the roof in terms of what   he is able to accomplish. So that's what people 
are buying. They're buying they're buy they're   buying into Elon Musk. So SpaceX right now again 
just to reiterate you've got this 18.7 billion in   revenue and a 4.94 billion in net loss. But what 
we know is that that could certainly be changed   if they made the strategic decision to no longer 
reinvest in these other portions of the business.   But they need to do that in order to achieve what 
they believe will be significant future growth.   So right now the market cap estimate and you 
can pull this from the S1 is between 1.75 and $2   trillion. SpaceX has a PE ratio that's undefined 
since it loses money. The shares outstanding will   be approximately 15 billion shares and the float 
which is the estimated shares that are being sold   in this initial public offering are between 550 
and 650 million shares. The exact number of shares   and the price is still to be determined. And here 
is where things get interesting for traders. Let's   go back to that number for one second. So they 
want to raise 75 to$80 billion. A higher IPO price   means fewer shares are sold. So they want to sell 
the shares at the highest price possible. That   way they can sell the fewest shares. So if the IPO 
price a company receives for the shares that they   sell minus the underwriting cost, the way this 
will work is the company is selling the shares   directly to their underwriter. So Goldman Sachs is 
buying the shares. Goldman Sachs takes the shares   and then resells them to institutional investors 
and to retail investors. So retail is being is   being allocated 30% of the shares in the float 
which is a very high level. I think it's five   or six times higher than average. Usually, as you 
guys probably know, retail traders never get any   shares in an IPO. You want to be in an IPO, you 
know, sucks to be you. You're not an institutional   trader. IPOs are almost always reserved, most of 
the shares, for institutional big money connected   traders. That's not true with SpaceX. SpaceX 
IPO is specifically requiring that 30% of the   shares in the float are being reserved for retail 
traders. which means if you go into your account   at Robin Hood or Schwab to request shares in the 
IPO, you may be able to get some shares. Now,   the demand is going to be incredibly high. So, how 
many shares you might actually get? You might say,   "I want a thousand." You might only get 10. So, 
it's hard to say, but ultimately you'll you'll the   shares will be distributed. Whether you get some 
or not, I don't know. But 30% will go to retail   and the remaining 70% will go to institutional 
traders. And then the day one opening price   typically is higher than the IPO price due to the 
increased demand as the IPO bro date approaches.   So let's say they IPO at $114 a share. And then 
the day the IPO they start saying we're indicating   that we're going to open at $140. Now it's $142. 
It's 144. It's 145. What's happening there is   people are already putting their orders in their 
queue in the queue to buy some shares. And that's   what typically happens with these super hyped up 
IPOs. So people buy shares ahead of time, mostly   institutional traders, and then the second it's 
IPOing, people want it that day. They didn't get   shares early and so they drive the price higher. 
But from a pure technical view, the float is is 15   billion shares and the number of shares being sold 
to raise 75 to80 billion will be between 550 and   650 million which means the float is approximately 
4% of the total shares outstanding. That is a   very limited level of supply. This is the very 
interesting technical component that you have to   be aware of. So because of this relatively limited 
level of supply during a period of high demand,   we could see the price in the first 5 to 10 days 
go up in excess of 100%. I'm not saying that   will happen, but we've seen that happen before. 
I'm going to show you the circle IPO. So circle   IPO earlier this year, similarly, relatively 
small float. And oh, we're going to go to the   daily chart on this. On this one, we IPOed and 
look at the price of this. We went from $60,   $70 a share all the way up to over $300 a share in 
a matter of a couple of weeks. I'm not saying this   is what's going to happen with SpaceX. But I will 
say that when we see companies that do IPOs where   the number of shares they're selling is small, you 
can get this big move right out of the gates. Now,   eventually the price usually comes back down. 
It usually does. And so this is where being an   investor and buying up here and holding, not a 
good spot to be in. Being a trader, getting in   and getting out a week later, maybe two weeks 
later before it starts to drop. That can work.   But this is not the place to be a long-term buyer. 
This is a place to just actively trade it and then   come back here six months later, a year later. 
This is where it starts to get more interesting   once we have a level of support. and then you get 
a nice rally from $40 back up to 140. That's where   you're going to have better risk-to-reward ratios. 
Okay? So, that's typically the case. So, in this   instance, let's think about this for a second. 
There was actually someone who um did something   kind of funny. They created a company and in 
the company they made uh 1 billion shares. So,   they created a corporation, filed it. Secretary 
of State corporation has 1 billion shares. Okay.   They then went out on the street and they said, 
"Would you like to buy one share of my company?"   And a woman said, "One share of your company? 
What are you What are you going to do?" He said,   "I'm going to I don't know what he said." He said, 
"I'm going to do something really incredible." And   she said, "Okay, yeah, I'll buy it." How much how 
much? 20 bucks. 20 bucks. She's like, "All right,   I'll I'll take it. $20." And he said, "My 
company's now worth 20 billion because the   share price is $20 a share. I own a billion 
shares minus one. So, I'm worth $20 billion.   Okay, on paper you are, but wait a second, the 
float is being deter the float is only 4% of uh of   of the total shares outstanding. And so what that 
means is that 4% of the shares are determining the   value for the remaining 96% of shares. So with 
a very tiny float, all of a sudden people are   clamoring to get a piece of this action and the 
price starts squeezing up higher and higher and   higher. But what happens when someone actually 
tries to go and sell 14.9 billion shares or 14.5   billion shares? Now, no, no single person owns 
that many. But aren't we thinking that eventually   these insiders are going to sell? Now, will Elon 
Musk sell? He probably won't. He would use his   shares as collateral and take loans. That's what 
most of these founders would would do. That's the   smart thing to do. So, he's going to own 42% of 
the company. His shares are not for sale. But what   about all the rest? What about all those hedge 
funds that put in billions of dollars over the   last 5 years? Some of their clients are going to 
want to redeem and take cash and take profit. So,   even if they don't want to sell, they're going 
to be forced to sell. And so, what I expect will   happen is we're going to have a problem here at 
some point. So the relatively limited level of   supply during a period of high demand can result 
in the price making a really big move. Suddenly   the market cap could go from 1.752 trillion all 
the way up to 3.5 4 trillion. I mean it's is it is   it possible that SpaceX within the weeks following 
the IPO could become the most valuable company   in the world. Could it become more valuable than 
Nvidia? Could it break a $5 trillion market cap?   It seems unthinkable until you recognize how this 
is being structured. That only 4% of the total   shares, the float, will determine the market 
cap for the entire stock. So, wouldn't all   the insiders just start dumping their shares right 
away if the stock goes up 100% the first few weeks   of trading? They can't. Insiders have a lockout 
period. This is very important. They cannot sell   legally. That means there is a window until the 
lockout period ends when the only true selling   will be from short selling people who believe that 
the price will go lower and it likely will when   the lockout period ends and then from arbitrage 
market makers and from retail traders who begin   actively buying and selling on day one. So let's 
look at the lockout schedule. So this right here   begins at 70 days after the offering. 70 days, 
7% becomes available and then as you could see   it stair steps up as you go to 90 days, 105 days, 
120 days, 135 days and 180 days. This was all part   of the filings. So the only uh lockout here 
is 10% getting unlocked if the stock closes   30% above the IPO price on 5 to 10 days trading 
post after the 630 earnings. So that's pricebased.   All the others are timebased. So we can expect 
that 180 days after the IPO, six months after   the IPO that the price will probably be falling 
and it might continue to fall and there will be   short sellers likely who try to anticipate this 
drop. So how much volume does SpaceX need in order   to support the current price without falling? 
In order to support the billions of shares that   will be sitting at record profits, it would need 
hundreds of millions of shares of volume every day   to support even just a modest amount of selling. 
So Nvidia does about 200 million shares of volume   a day. If you if you had 15% of that volume 
straight selling, it would suppress the price.   If it was more than 15%, the price would really 
be dropping quickly and shorts would see that and   they would take advantage of it. So these insiders 
are going to want to sell, but they don't want to,   you know, hurt their they don't want to hurt the 
stock either. So they have to unwind slowly. So   what you're likely going to see is months and 
months of consistent heavy selling at maybe 20   30 million shares a day. And it's going to take 
months and months and months at 20 to 30 million   shares a day to get billions of shares out the 
door. Now there will be some there will be no   doubt um some offmarket trades where you know an 
institution says hey we got to get rid of a block   of 500 million shares. Does your institution want 
it? and they do it and it's it's not going to go   through the market. It'll print later, but there 
will be those types of transactions, offmarket   transactions, but there will also be insiders that 
are selling right on the open market. So, as the   lockout day approaches, I would expect heavy short 
selling. And as the lockout day period periods   expire, lockout periods expire, I would expect 
heavy selling from insiders. This is not uncommon   with IPOs like I just showed you with the circle 
IPO. they IPO usually they have a very small   uh the the actual tradable float is very small and 
you don't have insiders selling and the company's   not doing secondary offerings right immediately 
on the IPO so you have a window where you can   have some really dramatic price action and then it 
falls it falls over and it rolls over and so the   typical chart for an IPO looks like this you you 
IPO well actually you IPO here a little hyped up   you rally up then you unwind you go below the IPO 
price, then you base out and then you start moving   up. This is the place to be an investor long-term. 
This first leg here is the place just to be, in my   opinion, a trader. This is just my opinion. It's 
not a guaranteed this is what's going to happen,   but this is based on what I've seen in the past. 
So, is SpaceX a long-term buy at the open? In   my opinion, no, it's not. It's going to be too 
expensive. It's a long-term buy after the lockout   period ends, and we see how many people decide to 
sell. Ultimately, maybe a lot of the shareholders   say, "I'm just going to hold on this thing and 
see if it turns into the next Nvidia or Tesla."   But my guess is that people are going to see how 
much they're up. They're going to want to take   profit off the table. And so, when that happens, 
you're going to see the price start to drop. So,   my feeling with these IPOs is they present an 
opportunity, an opportunity for volatility.   And so, I have to manage my risk, but I will 
be actively trading the SpaceX IPO. The only   things that would stop me is if the spreads 
are too big. So when I'm using the level two,   it's just too much risk. And so if I can't manage 
my risk, I won't take the trade. But as long as I   can manage the risk, I will be trading the SpaceX 
IPO. And then come six months, maybe a little bit   later, eight months, that's when I'm going to 
start thinking about, is this a time that I can   buy this for the long-term hold. I would love to 
hear your opinions. You may have opinions that are   very different from me on this. What do you think 
about Elon Musk? What do you think about SpaceX?   Are you going to trade it? You going to buy it? 
What are you going to do? You tell me in the   comments below. If you found this episode helpful, 
if this helps you better understand the SpaceX IPO   and get prepared, I hope you hit the thumbs up. 
I hope you subscribe to the channel. And hey,   if you want to watch me while I'm trading it 
live, I have twoe trials right here at Warrior   Trading. So during that trial, you can watch over 
my shoulder while I'm trading. You'll have access   to this same software right here. So you can see 
as I'm getting in, as I'm getting out, and on the   day of the IPO, it's going to be pretty exciting. 
With that, I'll remind you as always that trading   is risky and my results aren't typical. So, 
please manage your risk and always practice as   simulator before putting real money on the line. 
I will see you for the next episode real soon.