SpaceX is going public and everyone is talking about it. Neighbors, friends, group chats... the excitement is real. But most of the conversation is missing the most important question: what are you actually paying for? 

In this episode of Financial Commute, host Chris Galeski sits down with CEO and Partner Jeff Sarti to break down the SpaceX IPO from a valuation standpoint. Recorded on June 8th, this is the conversation the headlines are not having. Chris and Jeff walk through what price to sales ratio means, why a $10 stock is not cheap and a $1,000 stock is not expensive, and what history tells us about companies trading at extreme valuations. The story is incredible. The price is another matter entirely. 

Key Takeaways 

• Stock price tells you nothing about value. A $10 stock is not cheap and a $1,000 stock is not expensive. What matters is the underlying valuation — and SpaceX at roughly 100 times price to sales is extreme by any historical measure. 
• A great company is not automatically a great stock. Rivian grew its revenue 100 times over and is still down 90% from its IPO price. Cisco was the largest company in the world during the dot-com boom and collapsed 90% — taking 27 years to recover. Growth does not guarantee returns at any price. 
• 100 times price to sales is not a growth premium — it is speculation. The S&P 500 is currently at an all-time high of roughly 3.5 times price to sales. SpaceX is trading at nearly 30 times that. Even if SpaceX fell 80% from its IPO price, it would still be more expensive than Nvidia on a price to sales basis. 
• Volatility is near-certain even in good outcomes. Facebook fell 50% within six months of its IPO before going on to become one of the most valuable companies in the world. Buyers of the SpaceX IPO should expect a similarly turbulent ride regardless of the long-term outcome.