Al Root
Investors clamor to know when Elon Musk's SpaceX will sell shares in an initial public offering, but that isn't happening soon.
There is, however, a new secondary market linked to the commercial space leader -- buying and selling pieces of the recently exploded Starship.
Starship is the largest rocket ever built by humans, designed to lower costs to reach space by being fully reusable and big.
It's still in development. SpaceX tested Starship for the seventh time earlier in January. The upper half of the rocket exploded in spectacular fashion over Turks and Caicos.
Now pieces of that Starship have been scooped off the beach and are for sale on eBay. Some sellers are asking for $5,000 for a piece of debris. Other pieces are going for around $200.
Barron's can't verify the provenance of any Starship buys. Still, owning a piece is -- a little -- intriguing.
"There's some room on my bookshelf," says Andrew Chanin, CEO of ProcureAM. The Procure Space ETF invests in companies with space business. It trades under the symbol "UFO."
The eBay sale isn't even the most surprising part of the space week. Shares of commercial space players went to the moon after President Donald Trump mentioned Mars in his inaugural address on Monday.
Space equipment supplier Redwire stock rose 44% for the week. Shares of mini-SpaceX Rocket Lab USA jumped 27%. Shares of lunar lander maker Intuitive Machines and Earth imaging company BlackSky Technology jumped 25% and 28%, respectively. The S&P 500 gained almost 2%.
Space stocks "had some pretty incredible moves starting in May of last year," added Chanin. Intuitive Machines and Rocket Lab USA are the fund's two largest positions. The UFO has gained almost 50% over the past 12 months.
None of those four companies are profitable yet, but the prospect of higher demand is a powerful tailwind for investors.
"Most of these companies are still reliant on government business," said Micah Walter-Range, co-founder of consultant Caelus Partners, adding it appears the government's willingness to spend on space is increasing.
As for when SpaceX will sell shares to the public in initial public offering, becoming a publicly traded company in the process? Don't hold your breath.
In November, David Baron, co-manager of the Baron Focused Growth Fund, which invested in SpaceX early, said an IPO was likely three or four years away. SpaceX just doesn't need the cash.
Write to Al Root at allen.root@dowjones.com
This content was created by Barron's, which is operated by Dow Jones & Co. Barron's is published independently from Dow Jones Newswires and The Wall Street Journal.
(END) Dow Jones Newswires
January 27, 2025 01:00 ET (06:00 GMT)
Copyright (c) 2025 Dow Jones & Company, Inc.
Comments