Sometimes, good things come to those who wait. For those who were able to hold off from buying a few shares of Space Exploration Technologies (NASDAQ:SPCX | SPCX Price Prediction) on day one, there’s now a chance to buy at around the $135 per-share IPO price. If the sell-off continues, perhaps investors will be able to snag shares at closer to $100 per share. Either way, SpaceX has fallen out of favor in a big way, and not even table-pounding analysts or jaw-dropping price target projections have been enough to send the shares sustainably higher.
Indeed, the shares did land on the public markets at a very expensive valuation. And, as I predicted earlier, encouraging investors to avoid buying shares on day one (they ended up fluctuating around $160 per share) while also citing AI-related CapEx fears spreading to the name eventually, even as the Nasdaq 100 fast-tracked the name for entry.
Could it be that traders have moved onto the newer IPO with SK Hynix (NASDAQ:SKHY), even though SpaceX touched down on the public market just over a month ago?
Maybe, maybe not. But either way, I think SpaceX stands out as the far more explosive growth play than the likes of SK Hynix, which seems to have landed in U.S. markets at a time when the semiconductors and DRAM trade are about to suffer a correction, or worse, a vicious bursting of the bubble, as capital rotates from the sellers of “picks and shovels” to the users that will unearth all that gold (think the hyperscalers that were previously punished for spending so much on AI data center buildouts).
SK Hynix is hitting the ground running, but semis are in a tough place right now
In any case, SK Hynix is backed up, and it seems like even an aggressive expansion won’t result in enough memory chips to go around come 2028. While the supercycle has been fierce, I don’t see it as continuing forever, and that’s a major reason why the semis have been under pressure in recent weeks.
With Fed chair Kevin Warsh likelier than not to increase interest rates, at least in my view, I think the risk of a CapEx pullback could really hit semi stocks hard, well before any confirmation of slowing AI demand is in the books. Sure, the picks and shovels have sold incredibly well. But if there’s not as much gold out there, you simply shouldn’t expect people to keep buying.
While I do think a ton of gold will be unearthed as firms look to unlock AI-driven value, while some firms set monetary milestones to hit (most notably, the big banks), the big question is how many shovels and picks one person needs to dig up the gold. In any case, SK Hynix could be looking at $330.00 per share if Barclays’ forecast comes to fruition.
There’s a $900 price target on SpaceX floating out there!
Between tight supply over the foreseeable future and surprise potential, there certainly exists a path that could see shares gain close to 88% from here. At the same time, though, I think the bull-case target of $900 per share on SpaceX is the most jaw-dropping.
That’s a multi-bagger gain for investors who can pick up a few shares at around the IPO price. Of course, a lot of things need to go right and on time for the firm, as SpaceX looks to sell orbital AI compute while pushing a rush to the relatively untapped off-Earth economy.
In my humble opinion, those orbital data centers don’t just need to work, but they’ll need to work well. That means solar power will be enough while the data centers stay cool in space.
And, of course, maybe SpaceX will need to sell out of the compute as it seeks to become the only space hyperscaler. In addition, we’ll need to see successful Starship launches and rapid advancement over at xAI as Grok looks to push closer to the frontier. Of course, there isn’t much room for error, as SpaceX looks to crash or skyrocket based on every new development. Just like flying into space, SpaceX shares aren’t going to be for everyone.
Contact [email protected] for any questions or corrections.
Top Gaining Stocks
Top Losing Stocks