Don t Wait for the SpaceX IPO — Buy These 5 Stocks Right Now

It's one of the most anticipated IPOs in history and it's going to be happening soon. MarketBeans' Thomas Hughes is here to talk about SpaceX IPO and the five stocks to get into before that IPO happens. Thomas, before we get into this list of stocks today, I want to talk for a while here about SpaceX and this IPO. First off, why is it such a big deal? Why are there so many headlines and so many investors really interested in this IPO story? Well right, this is a big story that's been brewing for a really long time and it really starts with, I mean, a decades-old government push to move space investment from the public sector to the private sector. So instead of having tax dollars paid for it, they've been changing the rules, changing regulations. This is globally too, pushing for the privatization of space and it's been happening all over the world. Now, within that, SpaceX is by far the most advanced and the most successful commercializer of space. Right now, they're commanding like 80% or 90% of the total space market share, including launches and services and all the other things that they do. All these things combined together, the valuation on this company is humongous. So not only like anticipated, but very large. They're valuing the company about $2 trillion. They only want to raise about $75 billion. That's like two and a half percent. I mean, that's a really really wee, wee, wee amount, maybe less than two and a half percent, really small amount. So this company has a huge potential for raising money. But within all this, this story, it really would affirm the space investment thesis, which we think is going to unleash institutional investment and investment globally into space. Because all these other stocks that we're talking about, except for maybe one of them, they're all using SpaceX as their launch vehicle to get into space. In an article that I've written not too long ago talking about this very thing, the IPO, I see in the future, many competitors, many niche players in the space market. But when it comes down to it, the exploration of space is going to be branded SpaceX. I mean, the rockets, the large deep space vehicles, the boring company tunnels aren't part of the package right now, but I think that they will be. I mean, who else is going to make the means, the modes of transportation once they get to the moon? It's all part of this big, huge space investment package. I think that's what the market is really waiting on, this SpaceX IPO to help spur on even further investment into all of the whole space exploration sector. And we know there's several stocks out there that have already had some really big years, but I think the thesis is that once this IPO happens, more money is going to be flowing into these other names too. So we're going to get into those names soon, but more on SpaceX IPO itself. I think this is the thing that everyone wants a piece of. Everybody wants to get in on the SpaceX story because it is such a huge company. And one of our regular guests at the Oxford Club actually recently had a face-to-face meeting with Elon Musk about this SpaceX IPO. He now has a couple of special reports out you can check out for some insider insights, including the ultimate SpaceX pre-IPO play and three secret partners that are set to soar 1500% after this IPO. You can scan the QR code or click the link we have right down in the description to get the Oxford Club SpaceX reports today. So Thomas, I have a couple of follow-up questions on SpaceX. Why hasn't this company IPO-ed yet? Why has it waited until it's gotten this big before an IPO actually happens? And then two, how can investors get in on that before that official IPO happens? All right. So the first question is a big question. We've all been watching it for a long time. Elon Musk, he's in control of the company. He likes to be in control of the company. And he knows that when the company is needing cash, needing capital, it's the debtors, the debt holders and the investors that are going to be calling all the shots. So he said for a long time that SpaceX won't go public until it's making money. And now the underlying core SpaceX business itself may not be making money, but Starlink is. Starlink is the powerhouse for the revenue and the earnings potential. And that gives him the power to stay in control of what's happening because he wants the investment and they want the money, but they don't have to have it. And so for the second part of that question, you know, right now it is a privately held company. There are investors, but they're private investors. There's no public shares. You can get shares on the secondary market, which is kind of risky. And I believe that you need to be an accredited investor to be able to access that market. So you need to have a pretty significant amount of capital to do that. But you could also buy shares of Google or Tesla, which were both early investors and both own a significant exposure to the company. We're expecting to see both of those stock prices shoot higher as the IPO comes closer. And to tell you the truth, the IPO is underpinning both of their stock price actions today. Yeah. Let's talk about timeline for the IPO. What is the timeline? Do we know that yet? And what do you expect? What's your warning for retail investors once that IPO does go public? Do you expect a huge, you know, maybe overshoot reach when it first goes public? Or what are your thoughts on how to play that IPO? All right. So the timeline, they've been filing for a confidential listing. So that means we know that they've done it, but it's not any kind of public knowledge. We don't know the specific details. This allows the company to work with the listing agencies in a confidential manner without causing a lot of market volatility. So we think it's going to happen in June by mid-year, if not by then, then potentially soon after. As far as the stock price goes, the way that the hype is, the way that the market is getting into this, I would completely expect this IPO to be oversubscribed. They're probably going to list more shares than they initially wanted to sell. There's going to be a lot of demand. I expect there to be a fair amount of volatility. Within that, the demand is there to support the price action. But I also see the price action potentially spiking, you know, in a really big kind of way and short sellers to also get involved. Volatility for sure. If it goes up and then goes down, it's kind of questionable. But I would certainly think that maybe waiting a little while, not buying. I mean, if you feel like you need to buy immediately, I mean, that's totally OK. Just be prepared for some volatility and maybe hold some money in reserve to wait a little bit later to see if the price action kind of stabilizes and normalizes a little bit. Thomas, let's get into this list today. What is the first space company that you're looking at as getting a potential boost once the SpaceX IPO actually happens? Well, that's Rocket Lab. And Rocket Lab is the second player when it comes to U.S. domestic space launches and their launch vehicle. A distant second, but they're accelerating their pace of launches, which is representative of the entire global industry. It's the pace of launches, which is really driving all of this activity, all this expectation. And that's being seen in the outlook for SpaceX's IPO revenue and earnings, but also for Rocket Lab. This company has revenue now. Revenue is growing at a nice, strong, brisk pace. And we're looking at profitability next year. Profitability is a pretty critical factor, especially this year, because investors are so looking more for the cash flow and real profits and real returns, more so than those risky tech speculations. Yeah, this is a name that we've talked about on this channel for at least the last couple of years, and it has seen a tremendous amount of growth since then. But like you said, it's still in that speculative category. We're seeing some volatility, but we're also seeing that demand increase and getting so close to profitability. I think over a year ago, I had someone on who was talking about Rocket Lab's backlog, especially for satellite launches, that there's so much demand. There's a huge backlog. There's more demand than they can actually get to in a timely manner. And so let's talk about that a little bit. Do you see all of that demand leaning towards true profitability for this company soon? And do you see that demand continuing to grow? I do, because they've commercialized their vehicle. They're accelerating their launch pace, accelerating their production pace. They're working on their heavy lift vehicle. And within that, the entire industry is also blossoming and driving that demand. A lot of the demand today is just for space services or for launches to get satellite constellations into orbit. But longer term, the launches are going to be centered on industry, servicing low orbit and a medium orbit infrastructure, as well as on the moon. One of the things that Elon Musk is talking about now is his long-term goal is the Mars mission, but between then and now is the moon. And so now he's talking about building this self-sustaining moon colony that perhaps could be up and running within the next decade. And so that certainly plays in both to SpaceX, but also to Rocket Lab's launch pace and the demand for their services. I know this is a great topic right now because all eyes have been on the moon this last week with the different launches that we're seeing. So it's a very timely topic. We can see this happening real time. The demand is there. Before we move on to the next one, just because Rocket Lab is the other really big name in the space sector, let's look at the chart and the volatility that we've seen. Rocket Lab surged so high at the end of last year, beginning of this year, and it's had quite a tumble along with a lot of the other speculative small cap names. It's starting to bounce back some now, but do you think that there was anything fundamentally behind the drop that we saw early this year, or is that more of just what was happening in the overall market and economy? Well, fundamentally, yes, because the fundamental outlook is swelling and blossoming and that's causing these stock price surges. The market gets ahead of itself and then it corrects, which is what we saw the first part of this year. Right now, what I'm seeing in the chart is the market establishing support at a new higher level, aligning with the previous highs. So to me, this market is ratcheting higher slowly, but surely. All right, let's move on to the second name. We have a list of five to get to today. So what's the second space stock you're looking at adding before the SpaceX IPO? So that's AST Space Mobile. This company is one of the ones that's leaning hard into SpaceX and Rocket Lab launches to get their Constellation into orbit. But their Constellation is for servicing 5G networks. They're providing global, uninterrupted satellite-based 5G coverage for mobile devices. I mean, it's hot. I mean, can you imagine having that kind of coverage? You can take your phone anywhere in the world and be sure of getting good coverage. It's really fantastic. But right now, they're also in a ramping phase. They've been ramping the pace of their launches. They've been getting their Constellation into space. They're expanding their services. They've got revenue starting now. Revenue is going to be ramping over the subsequent few quarters. And we're looking at profitability within two years. You know, again, it's that revenue and that profit outlook, which is driving the stock price. The market gets a glimpse of how much revenue it's going to make and the stock price surges higher. Then it gets a little dose of reality, which is just that it takes time for these things to happen and it pulls back. Right now, that stock has pulled back the same as Rocket Lab, but it's showing support at a similar comparable level in an uptrend. I think this market's waiting for the next good news, which will be in the next earnings report. And then potentially it will rally onto a new high at that time. Yeah, people who watch our channel often know that this is one of my favorite concepts. I really like the concept of this company and the idea of making cellular service all satellite-based network. I think it's a great concept that could really change cell phone service. So I love the idea and clearly the market does too. But I want to talk a little bit more about what we've heard from some people who say, well, just because the idea is there doesn't mean they're actually going to pull it off. It takes so much capital to pull off a new concept like this. And so is there a chance that there is still a significant risk here with this stock? Like you said, it's really surged incredibly high, almost a 300% gain in the last year because investors in the market like me are excited about the concept and the idea. But is that risk still there of it actually happening? I mean, there is risk, but they're de-risking it on a daily basis. Their technology works. They're getting their constellation into space. They've secured the contract with the major providers. It's just a matter of following through and executing. So execution risk, I think the biggest risk will be delays. So if we get any kind of delays, you can see a pretty sharp stock price drop. But without that, I expect to see this market continue to ratchet higher with periodic pullbacks as it executes on its strategy and starts delivering on its results. Now, this is a similar story for pretty much every name in the space sector right now. But you look at their earnings and you can see, and you look at their financials, you can see they're burning through a lot of money to make this happen right now. What are you looking at to know, okay, this is a healthy growth phase? Yes, it takes a lot of capital to make this happen, but they're fundamentally on the business side of things managing all of that expense pretty well. It's all offset by the backlog and the contracts that promise the long-term revenues that will help pay for these bills. So just like in the AI buildout, it's taking some debt to get things going now, but we know that we need these things and the demand is there. So once it's built, the revenue streams will be unlocked and profits will start to flow. All right, let's get on to the third company. Speaking of the moon, this one seems to be really centered around that. Right, that's Intuitive Machines. They make robots and components for space, primarily focused on the moon and the moon mission. They're not making rockets or even the capsules, but more the landers. There's a high demand for these products. Their revenue is among the best of any of the non-SpaceX space companies growing at a nice double-digit pace and they're looking for profits next year. To me, that makes this one of the better plays just because profitability is so close. You can also see this in the price action because this market has been moving sideways over the last year or so, but in the last year, it moved up to the top of our trading range and right now it looks like we're breaking out of that range. The profitability part of this stock is what's so interesting because like you said, space sector as a whole, it's still very new. Everyone is still burning a lot of cash right now and still just growing towards profitability, but for this one to be so close to profitability and to know that SpaceX is planning that colony on the moon as a potential next step, this company seems like it would be a direct beneficiary of some of that. I think it's an interesting one to look at. It is concerning to see how recently it had a really big spike. It was down at around $16 just a few days ago and now it's had a really big jump recently, but any fears behind really big surges like we just saw this week? Well, yeah, that big surge this week, I think, is directly tied to news in Iran. It's macroeconomics versus the actual fundamentals, but it's the outlook that has got the market supported. So with those geopolitical fears having been diminished, it provided a clearer pathway for the market to advance. One of those factors that takes away that risk potential is just looking at are they making money and how they're making money. So you said they're very close to profitability. How are they making money right now? They're making money not so much with their lunar landers, which is definitely part of the picture, but more so with services and engineering. They have many contracts with NASA and government defense-related organizations, and they're providing lots of services for those people. So more than just Moon Machine, there's a lot of other services and parts of this company that make it so interesting and potentially profitable, but we know they are not the only company that could see a big boost in profits once this SpaceX IPO takes off. However, the window to get in early on these names is starting to run out. So if you want to take a look at three secret partners set to soar 1500% with this IPO growth story, make sure to check out that special report from the Oxford Club. I've got the QR code up here again and that link in the description, so you can hear directly from an insider who met face-to-face with Elon about the SpaceX IPO. All right, Thomas, let's move on to stock number four that you are looking at in the space sector. Yeah, that's Planet Labs. They're launching and operating a constellation of satellites for Earth imaging and providing services based on that. They're still early on their ramp, but they're launching satellites. They've got a constellation in place and they have revenue, but the big thing holding them back is profitability. Of these five companies, it's got one of the longest runways to profits, so that might not be until 2029 or 2030. The potential catalyst for this stock though would be an acceleration of that outlook, which could potentially be spurred by the SpaceX IPO and the inrush of capital that will be expected to the space industry. Yeah, this is one where I want to talk a little bit more about that potential connection to SpaceX. I know SpaceX is really working on space exploration, talking about the moon, talking about going to Mars. They've got other things in space they're working on too, but Planet Labs is a space company focused on Earth, right? They're doing Earth imaging. How could they potentially be connected to any growth that SpaceX might see? Right, so Planet Labs is connected to SpaceX in the traditional way where they use SpaceX's services. So it just plays into that big picture for SpaceX being the lead lift company for space. Any company that needs anything to be in space is going to go to SpaceX and use their Falcon 9 rockets. So connected in that it will help support the growth of SpaceX with the demand that it brings to the table. Interesting, and this is another name that I've heard many of our viewers talk about as a company they're bullish on in the overall space story. Is there anything that sets this one apart when you look at the chart, when you look at what analysts are saying, when you look at just projected growth for this company? Is it just another space name or is there something unique about Planet Labs that you like in particular? Nothing really jumps out at me personally, but the chart action certainly speaks for itself. This market definitely likes the stock and the outlook. It's been in rally mode. It's one of the better looking charts for the sector. The market is running ahead of sentiment, so there's definitely potential for a pullback. If we get one, I believe it would be a buying opportunity. If we look at the institutional data, they own about 40% of the stock, but they've been buying at better than 2 to 1 pace. So I would think that they would be interested in buying this name anytime that there was a discount offered. All right, another good name to look at in the space sector. Let's get on to the final stock that you are looking at, and this is a completely different area of the space story. Yeah, this is Redwire. They're more into orbital manufacturing and infrastructure for that kind of industry. Think about large arrays of solar panels, and they need to have some kind of a superstructure to be attached to. So that's the kind of thing that Redwire does. Again, this company has a pretty robust outlook. It is making revenue, but like Planet Labs, its timeline for profitability is pretty far out there. So of the five stocks, it's one of the weaker plays, I would say. That is reflected in the chart price action. The stock price has struggled for over a year. Right now, it appears to be at a bottom and kind of establishing a support base, but it doesn't look all that bullish compared to some of the other names. Do you still think there's potential with the services that Redwire provides for it to see increased demand once the entire space economy starts to really ramp up later this year after that SpaceX IPO? Well, right. This company is in position to get a boost if the assumed boost to space investment does come. You got to think that all these companies are going to be moving into space, trying to build satellites, trying to build infrastructure, trying to build manufacturing capacity, buildings on the moon, whatever it is, they're going to need the product that Redwire makes. In the near term, there could be headwinds, but I think once the industry starts to accelerate a little bit more, Redwire might see a boost. Certainly a lot of potential in this area and really all eyes are on the space sector as more growth is coming. So if you want to hear some other potential names in the space sector, make sure to check out this video. It's a list of 10 stocks that are all deeply involved in that space sector. Some smaller names that maybe you haven't heard of yet. You can check out that video here.