Ahead of this final trading day of the week — which has climbed past Friday’s highs after a tumultuous past few sessions — pre-market futures are up again, following a boffo Thursday that saw major indexes rise between +1.75% (S&P 500) and north of +2.5% (Nasdaq). Currently, the Dow is up +300 additional points, the S&P 500 +30, the Nasdaq +70 and the small-cap Russell 2000 is +13 points higher.
SpaceX to Make History on Its IPO Today
Elon Musk’s SpaceX (SPCX) will not be the first publicly-traded space rocket company — there are Rocket Lab RKLB, EchoStar SATS, AST Spacemobile ASTS and Virgin Galactic SPCE, just to name a few — but it will be the biggest. Currently valued between 1.75-2.00 trillion in market capitalization, today’s IPO is underwritten by Goldman Sachs GS and is expected to raise $75 billion.
The finances get a bit gnarly fairly quickly when we look into this IPO: while more than 555 million shares will be on offer, there is a known lockup period out in mid-August and some two dozen levered ETFs related to SpaceX going public, again just to name a couple examples. This doesn’t even begin to address Musk’s expressed interest for SpaceX to acquire Tesla TSLA, the CEO’s other trillion-dollar corporation.
Without getting too deep into the smoke on the launchpad, suffice it to say this IPO is not guaranteed to blast off and take retail markets with it. Those early investors in the company — SpaceX was founded way back in 2002 — will clearly do great today; they’ve literally had this moment circled on their calendars for years.
Why SpaceX is a long-term winner is crystal clear: with database installation outside the Earth’s atmosphere, and perhaps energy stations and other huge enterprises as well, SpaceX’s utility is vast and forward looking. Its Starlink satellite systems (more than 10K and growing) has already manifest itself as a key cog in global communications. So while the near-term hype may not be worth the navigation to get a piece of this IPO, ultimately SpaceX looks to be nothing short of a staple of the American economy.
What to Expect from the Market Today, Next Week
Follow along with Zacks Strategists Tracey Ryniec and Dave Bartosiak starting at 10am for analysis, insight and documentation of the first trades for SPCX.
Meanwhile, after today’s open, the latest Consumer Sentiment survey from the University of Michigan is expected to improve slightly off May’s all-time low 44.8, but only up to a still-paltry 46.0. A full 57% of respondents last month cited a high cost of living — sparked by high gasoline prices that resulted after the war on Iran led to the closure of the Strait of Hormuz. Politically speaking, Republicans and Independents joined Democrats at these low sentiment levels.
Finally, as last week was Jobs Week and this week addressed Inflation, next week brings us key data on the Housing market. Housing Starts & Building Permits, Home Builder Confidence, and Pending Home Sales will give us a clearer picture of this space, which looks to be rebounding off multi-year lows in recent months.
Beyond Nvidia: AI's Second Wave Is Here
The AI revolution has already minted millionaires. But the stocks everyone knows about aren't likely to keep delivering the biggest profits. AI’s second wave is moving from infrastructure to implementation and these companies are at the forefront of this transition, positioned to become what Amazon and Google were to the internet era.
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The Goldman Sachs Group, Inc. (GS): Free Stock Analysis Report
EchoStar Corporation (SATS): Free Stock Analysis Report
Tesla, Inc. (TSLA): Free Stock Analysis Report
Virgin Galactic Holdings, Inc. (SPCE): Free Stock Analysis Report
AST SpaceMobile, Inc. (ASTS): Free Stock Analysis Report
Rocket Lab Corporation (RKLB): Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).