Behind the video
holy sh*t spaceX stock
Overall Thesis
The host views SpaceX shares as inexpensive and maintains a bullish holding stance following strong compute revenue growth, customer prepayments and its first profitable public quarter. He expects a Tesla merger to facilitate fundraising, while acknowledging enormous capital requirements and some temporary earnings benefits.
Narratives
SPCXSpaceXThe host considers SpaceX inexpensive at roughly one PEG and explicitly maintains his bullish investment stance without selling shares. He emphasizes compute revenue growth and customer prepayments, while recognizing substantial financing needs and temporary contributions to earnings.
Key Arguments
- Compute revenue nearly tripled, while deferred revenue increased by approximately $2.8 billion, indicating customers are paying ahead of service delivery.
- Higher Starlink average revenue per user and connectivity growth support a second growth engine.
- The company reported its first profitable public quarter.
- A potential Tesla merger could facilitate fundraising, and planned debt issuance could reduce stock dilution.
- The host characterizes SpaceX's valuation at roughly one PEG as inexpensive.
Risks acknowledged
- The host estimates approximately $433 billion of additional funding may be needed.
- Free cash flow was negative approximately $35 billion over nine months.
- About $1 billion in other income partly reflects temporary benefits.
- Space launches and connectivity are growing more slowly than compute.
- Starlink deployment has experienced substantial delays.
Predictions (1)
NVDANvidiaThe host views SpaceX's continuing infrastructure spending as beneficial to Nvidia, citing its exclusive partnership for space and involvement in other data centers. This is favorable business commentary without a distinct forecast for Nvidia shares or an explicit investment action.
Key Arguments
- SpaceX's large continuing capital requirements imply substantial infrastructure purchasing.
- The host identifies Nvidia as SpaceX's exclusive partner for space.
- He highlights Musk's enthusiasm for Jensen Huang and Nvidia's involvement in other data centers.
TSLATeslaThe host expects a Tesla–SpaceX merger to secure approval and improve fundraising flexibility. He considers Tesla expensive, describing its current PEG as roughly twice what it is worth, but does not establish an independent absolute share-price forecast.
Key Arguments
- The host believes shareholder approval is likely given support for Musk's compensation package.
- A combined company could raise capital more easily.
- Tesla shareholders could receive a merger premium.
- Tesla's valuation appears expensive relative to SpaceX under the host's PEG comparison.
Risks acknowledged
- The proposed merger still requires shareholder approval.
- A premium for Tesla could increase the effective cost paid by SpaceX shareholders.
Hedges & Caveats
- SpaceX may need to raise approximately $433 billion of additional capital under the host's estimates.
- Debt financing could reduce dilution, but substantial funding requirements remain.
- Approximately $1 billion of other income includes benefits the host expects to normalize.
- Compute growth requires substantial continuing investment; launch and connectivity growth are slower.
- The merger remains subject to shareholder approval.
- The host says his SpaceX discussion is not financial advice.