Equity Research · Current Holding
SpaceX
SPCX · Private · Secondary · Launch · Satellite Broadband
Rating
Underweight · Short
Cover Target
$100
Quan Pham, Senior Analyst · M’Squared Capital Research · As of Q2 2026
A generational company at a valuation that already prices two flawless decades — we fade the froth, not the engineering.
Summary
SpaceX is the premier launch and satellite-broadband franchise, but secondary-market marks embed near-perfect execution on Starship and Starlink monetization. We are short the froth in the private-market valuation via secondary instruments — a small, defined-risk position, not a bet against the rockets.
Business Overview
SpaceX operates Falcon and Starship launch and the Starlink broadband constellation. Our exposure is expressed through secondary and pre-IPO instruments rather than a listed equity.
Short Thesis
- 01
Valuation prices perfection
Secondary marks capitalize Starlink and Starship success that remains years and tens of billions of capex away. The margin of safety is negative at the current implied valuation.
- 02
Starlink economics unproven at scale
ARPU, churn, and the capex to continually replace a depreciating constellation are still unproven against the embedded multiple.
- 03
Liquidity and discovery risk
Private marks lag reality. A funding round or an IPO can reprice the entire stack sharply lower once public price discovery arrives.
Valuation & Downside
Our $100 per-share-equivalent target (on the current secondary basis) reflects a normalization of the valuation toward achievable Starlink cash flows. The instrument is illiquid; we size it small and cap the risk.
Catalysts
- A down-round or IPO forcing price discovery
- Starship program delays
- Starlink competition (Kuiper) and pricing pressure
- Broad private-market multiple compression
Key Risks
- Starship success re-rating the franchise higher
- Continued private-market exuberance
- Illiquidity and borrow constraints on the expression
Bottom Line
A great company priced for perfection in illiquid hands. Short the froth, target $100.
This note is the opinion of M’Squared Capital and is provided for informational purposes only. It is not investment advice, nor an offer or solicitation to buy or sell any security. Price targets and entry and exit levels reflect the firm’s proprietary views and realized transactions; they are not forecasts of future results. The firm may hold, add to, reduce, or close any position at any time without notice. Past performance is not indicative of future results.