If I Had $5,000 to Invest Today, Here's the Trillion-Dollar Stock I'd Buy Instead of SpaceX
This company is attacking the artificial intelligence opportunity from multiple angles.
Overview
Elon Musk's Space Exploration Technologies (NASDAQ: SPCX) went public in June, and it received a positive reception from investors who quickly sent its stock soaring to a peak of $225. However, the initial enthusiasm faded, and the stock has since declined by 29% to $158.96 (as of the market close last Friday, Oct. 2).
Valuation might be the reason why. SpaceX still has a market capitalization of $2.1 trillion, so based on the company's trailing 12-month revenue of $23 billion, its stock trades at a hefty price-to-sales (P/S) ratio of 94, making it 14 times as expensive as the technology-heavy Nasdaq-100 index.
Details
Therefore, although management is predicting significant revenue growth over the next few years, more downside might be ahead for SpaceX stock in the near term. Value investors might want to look elsewhere for positive returns, and if I had $5,000 to deploy into one stock today, here's why I'd buy Microsoft (NASDAQ: MSFT) instead.
Source
Originally published at www.fool.com.