“We want to open up space for humanity, and in order to do that, space must be affordable.” – Elon Musk

Executive Summary

With the impressive increase in SpaceX valuation during the last five years, the company became the second most valuable private company in the world. The growth of SpaceX's valuation is led not only by the significant increase in the revenue (around 78% during the last three years) but also by its exclusive technology that outperforms its competition across many key metrics.

If SpaceX was an ordinary company, you would look at its market and products and say that it is a unique investment opportunity with features of big tech, aerospace, and defense stocks. But when you add to this its current technological and commercial lead in an industry that is growing at light-speed and will reach USD 1 trillion by 2040, there are few comparisons.

Given the current and prospective contracts with NASA, the revenue is expected to grow 3-4x over the next two to four years.

Like the internet at the beginning of the century created a whole new economic area on Earth, SpaceX creates it in space, enabling space tourism, and Mars colonization.

An in-depth analysis of Starlink, the SpaceX satellite-based Internet service, showed that it will provide SpaceX with the largest share of its revenue in the near future. Following the recent upward trend of the satellite broadband market and the technological leadership of Starlink, it will quickly take the lion's share of the market by 2025. If Starlink is spun-off in the future as hinted at by Elon Musk then this will unlock even more value for SpaceX shareholders.

While Starlink gives SpaceX the characteristics of a telecommunications company, its rocket business gives it the solid acyclical cash flows of an aerospace defense contractor, like Lockheed Martin. SpaceX already has billions of dollars in contracts with NASA for various missions, and luckily will rise due to increased international competition in space and NASA’s increasing reliance on SpaceX.

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