Whitney Tilson: "I think SpaceX will fall 70% from its opening-day close.
It's shaping up to be one of the most overhyped, overvalued large-cap IPOs of all time. The numbers are absurd... SpaceX looks set to trade near 100x revenue, with 15% top-line growth last quarter and accelerating losses.
When things are this obvious, making a "big call" like this is easy..."
Rule changes for the SpaceX $SPCX IPO:
Index providers waived the profitability requirement and cut the seasoning window from 90 days to 5.
This forces over $30 trillion in passive 401k and retirement money to buy SpaceX at IPO valuations.
Bloomberg Intelligence estimates S&P 500 funds must absorb 19% of SpaceX's float within 6 months.
Russell 1000 and Nasdaq 100 funds will absorb 24%.
The rules built to protect passive investors:
1. S&P 500 has required 12 months of trading and 4 quarters of GAAP profitability since 2002. Both waived.
2. Nasdaq cut its inclusion window from 90 trading days to 15.
3. FTSE Russell cut its to 5.
All three benchmarks are now structured to buy SpaceX at IPO pricing.
One of the strangest economic shifts in modern America is that “making it” increasingly depends on whether your parents can subsidize adulthood.
A hidden second economy now exists where family support quietly determines:
• who can live in expensive cities
• who can take career risks
• who can save/invest early
• who can survive emergencies
Two people can make the same salary and live completely different lives depending on whether mom and dad are helping behind the scenes.
People complain when schools are falling apart, then complain when communities actually invest in doing it right. Indoor practice facilities, fine arts spaces, and gyms aren’t luxuries in Texas they’re used constantly by thousands of students and the community for decades.