Andrew Sather, co-host of The Investing for Beginners Podcast, wants to own SpaceX, but he refuses to. On the episode AI, Space, and Defense: Separating Hype from True Moats, Sather ranked SpaceX last among the investment options discussed in the episode, and gave two blunt reasons: “One, I don’t buy IPOs. Two, there’s just too much unknown. We just got to let the price settle.”
Why SpaceX Is Testing One Investor’s Strictest Rule
Sather’s discipline is to avoid buying at IPO as a standing rule, wait for price discovery, and separate enthusiasm from logic. Coverage of SpaceX’s lockup dynamics flagged roughly 911 million insider shares becoming eligible, substantially larger than the entire IPO, with the public float potentially tripling, and warnings from Robert Greifeld, CNBC’s Morgan Brennan, and JonesTrading’s Mike O’Rourke, who flagged the combined supply coming to the market of mega-cap listings such as SpaceX, Anthropic, and OpenAI.
The bull case exists too. Bernstein’s Doug Harned raised his SpaceX price target to $248 with an overweight rating on the orbital data center opportunity, and Jim Cramer has framed it as a long-term yes but a short-term wait. Cramer said on air that “the opening price, the closing price and everything in between are out of his hands” once shares hit the syndicate. As Andrew Sather put it, “People selling their shares, all that stuff, that always hits a stock really hard when it first IPOs.”
Only Three Public Space Companies Are Actually Profitable
The host noted that only 3 publicly traded companies are actually running profitable space segments: Northrop Grumman (NYSE:NOC | NOC Price Prediction), Lockheed Martin (NYSE:LMT), and L3Harris Technologies (NYSE:LHX). He ruled out Blue Origin because they aren’t publicly traded today.
The host also shared a personal regret about selling Northrop Grumman to chase growth elsewhere, calling it “a stupid mistake” because “that stock’s done great and the growth that I thought I was buying into was not growth.”
Northrop Grumman
Northrop Grumman reported Q2 2026 Space Systems revenue of $2.753 billion, up 4% year-over-year, with a second-quarter Space Systems operating margin of 8.6%. Full-year guidance calls for about $11 billion in Space Systems sales at margins in the low 10% range. National security space backlog stands at over $16 billion. Shares are down 2.61% year-to-date.
Lockheed Martin
Lockheed Martin reported Q2 Space revenue of $3.496 billion, up 6% year-over-year, and now guides 2026 Space sales to between $13.85 billion and $14.05 billion. Full-year Space profit was trimmed to between $1.34 billion and $1.38 billion due to reduced ULA equity earnings tied to the Vulcan launch anomaly investigation. Programs include Orion, Next Generation Interceptor, and Fleet Ballistic Missile. Shares are up 17.9% year-to-date, with a trailing P/E of 21.
L3Harris Technologies
L3Harris Technologies reported Space & Mission Systems revenue of about $3 billion, up 7%, with segment margin of 9.8%. Management raised Space & Mission Systems 2026 revenue guidance by $200 million to $11.7 billion on the AMDT-3 constellation win, and CEO Chris Kubasik said L3Harris is “the only company to be awarded all five contracts related to missile tracking” with a $9 billion pipeline over the next several years. Shares trade at a forward P/E of 23.
Key Takeaways
SpaceX may eventually become a great public company, but that does not guarantee it will be a great investment today. Sather’s approach is to let the excitement fade and see where the stock trades when the dust settles.
In the meantime, Northrop Grumman, Lockheed Martin, and L3Harris offer investors immediate exposure to profitable space businesses without the uncertainty surrounding a blockbuster new listing.
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