The current P/E ratio for the S&P 500 (growing far more slowly, obviously) is ~25.
By many historical metrics, the stock markets are insanely overvalued these days. Far too much cash in the system, bidding up the "values" of anything that remotely resembles an investment.
> By many historical metrics, the stock markets are insanely overvalued these days. Far too much cash in the system, bidding up the "values" of anything that remotely resembles an investment.
Right. This is the same stock market that at one point said Tesla was worth more than every other car manufacturer. Combined.
Worth more than: Toyota, Volkwagen Group, Hyundai/Kia, General Motors, Ford, Nissan, Honda, Fiat Chrysler, Renault, Suzuki, Daimler, BMW, Mazda and Mitsubishi. Combined. (Plus several Chinese manufacturers: SAID, Geely, Changan, Dongfeng).
They have huge majority of market that’s much smaller than their valuation, and isn’t growing anywhere close at the pace they predicted (if they didn’t burn their own money to lunch hundreds of starlinks, their growth in launches would be pretty flat).
But anyway, op used P/E ratio to justify spacex valuation, in a totally wrong way. Their P/E ratio is in thousands (assuming there’s no creative accounting to show that profit, as they have many money burning projects and keep on raising billions). And they own a lot of the market and market itself isn’t growing fast.
You can justify their valuation with lofty goals and mission, if that’s your thing. But not with financial numbers and market sizes.
Why don’t you present data that supports your statement?
Weight to orbit isn’t number of lunches. They’ve been doing around 30 per year, for paying customer, for many years now. And one of deals may push it higher, like Amazon, but so far they didn’t show ability to sustainably grow the whole market.
I didn't give number of launches for the same reason I don't measure how big a courier is by the number of vehicle trips they have. It's just a worse stat. Mass to orbit is still flawed, underweighting high delta-v flights, but not to the extent that it would claim an Electron flight is equivalent to a Transporter mission.
> They’ve been doing around 30 per year
(N+1 means N dedicated launches, plus 1 Starlink rideshare.)
This is pure invention. They've done 24+1 this year, putting them on pace for 33+1 to 34+2 — the schedule is for 46+1, but there are always customer delays. They did 27+2 last year. Then 14+2 before that, then 12+1, then 11. There was a small one-time launch glut in 2016-2017, when they were emptying the built-up commercial backlog other providers had underserved, but that's 18 and 21 launches, still much lower than their current run rate, and you can hardly blame satellite providers for taking a few years to adapt to build their new satellites.
We saw the same thing play out with Falcon Heavy, for example. After its initial flights, it was left without a lot to do. Only very recently have the satellites built for its capabilities shown up, and in the last 12 months it has flown 4 times, with yet two more planned for this year alone.
On the Falcon Heavy point, we're also seeing new valuable launch niches, with not just Heavy flying regularly, but an increase in commercial crewed launch too. Transporter flights are not especially expensive but they're clearly a valuable market that could not exist without SpaceX.
> And one of deals may push it higher, like Amazon, but so far they didn’t show ability to sustainably grow the whole market.
The pretense that an 89 launch deal for a long-lived constellation isn't growing the market is nonsense. That's like 10 years of flights at ULA's heyday, from one customer's initial launch deal alone.
Some amount of the value baked-in assumes that SpaceX will earn money on any of the thousands of revenue sources possible in the creation and running of the first large-scale city on Mars.
Maybe you think it isn't going to happen - and sure there is some risk (!) - but in the successful case, SpaceX should be worth many trillions. At least.
Hint: Starship cans are comically inadequate to support a martian colony. They might be just adequate to maintain a lunar outpost -- if they turn out to work at all. We don't even know if humans can survive, long-term, in 0.3g; zero g, anyway, is right out. Life in centrifuges on Mars would be even less fun than in cans.
If some follow-on vehicle were ever developed adequate to support a martian colony, and lunar gravity were to turn out to suffice, getting any actual value return from such a vehicle is hard to imagine. You might try to use it to support automated mining of platinum-group metals from asteroids, but it is far from clear how that could be made to work out. That it seems possible in principle is usually not considered a sound basis for investment.
Musk certainly understands all of the above. He will cash out long before it is demonstrated to all be a pipe dream.
Maybe look into how many launches are needed to loft fuel to send just one can to Mars. And, how many passengers, realistically, fit in a can on a 9-month (note, not 6-month) trip, with supplies for the trip. Hint, not 100, and not 20. Hopefully the supplies needed to survive there are in other cans already there. Literally nothing there is worth exporting except maybe reality TV; not cans, and not even just engines taken off the cans. Never mind homesick colonists.
Pressure suits for everybody on board might be crammed in, but more likely just two or three to use collecting more from cargo ships already landed.
> Some amount of the value baked-in assumes that SpaceX will earn money on any of the thousands of revenue sources possible in the creation and running of the first large-scale city on Mars.
For that to make any sense at all, somebody would need to figure out a profitable economy for a Mars colony. Nobody has been able to do that.
Big defense contracts from the US military is where SpaceX will strike gold, if they do. All the money is in launching stuff into Earth orbit to serve some practical purpose on Earth.
It’s amazing that after hacker community got to see how full of shit guy making those promises is, with Twitter, some still believe that in other areas he’s not lying.
By many historical metrics, the stock markets are insanely overvalued these days. Far too much cash in the system, bidding up the "values" of anything that remotely resembles an investment.