Most Investors Are Overpaying for SpaceX Stock. Here's the Price I'd Actually Buy At.
SpaceX could be a transformational business, but investors are ignoring the risks at this price.
Overview
Space Exploration Technologies (NASDAQ: SPCX) is one of the more attention-grabbing stocks on Wall Street and Main Street. Wall Street analysts are generally bullish on the stock, with an average price target of $223 per share for the recent IPO. That's about 40% above its current share price. Retail shareholders bought a lot of stock early on, but recent selling has left retail inflows into SpaceX at about $3.4 billion.
Despite investor optimism, I think most are overpaying for the stock. To be sure, SpaceX could become a transformational business across multiple industries, generating unparalleled revenue growth. But the market is pricing the stock as if Elon Musk's trillion-dollar revenue projection for 2030 is an eventuality, not a highly uncertain possibility. There's no margin for error in SpaceX stock today. Here's the price I'd actually buy it at.
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Originally published at www.fool.com.