The post-listing announcement by Space Exploration Technologies Corp (SpaceX) of its acquisition of coding startup Cursor drove the share price over US$213 before falling back below $190, briefly valuing it at $2.78 trillion compared with Amazon’s $2.66 trillion.
Amazon has an actual ongoing business with multiple lines. It made $30.3 billion of profit in the first quarter of 2026, while SpaceX is still burning money, losing $4.3 billion over the same period. SpaceX remains the very definition of a speculative stock.
For one thing, its pivot to artificial intelligence may have captured the latest investment fad, but remains highly questionable. Data centres in space may be far less polluting than terrestrial counterparts, but they are definitely unproven. Power requirement issues, never mind the scale of build-out, are unsolved and worrying considerations — and cited as such in the prospectus.
For another, another X, formerly Twitter, should give investors pause regarding Elon Musk’s track record in sustaining shareholder value. And with a public float of only about 4%, SpaceX is very vulnerable to dilution.
Commentators have also warned about its corporate governance standards. Super-voting shares still give Musk almost complete control over the company. Its various potential business directions and capital needs are almost all subject to his personal decisions.
For some investors, Musk and his personality are part of the appeal. Nonetheless, that is far from rational investment calculation. Some of the largest and most influential US institutional investors have already raised grave concerns about the company on this basis. SpaceX’s IPO prospectus also warned that the company’s structural provisions limit shareholder powers to pursue legal redress.
The New York State Common Retirement Fund and the California Public Employees’ Retirement System wrote to SpaceX management, challenging the “novel and extreme governance structure and provisions SpaceX is planning” and “the most management-favourable governance structure ever brought to the US public markets at this scale”.
Danish pension fund AkademikerPension excluded SpaceX as a prospective investment, denouncing it as burdened by a “catastrophic governance structure” and “grossly overvalued”.
Notably, the Securities and Exchange Commission has remained silent on the SpaceX governance structure.
One consideration for regulators is that the Cursor acquisition is apparently aimed at short-cutting some putative bottlenecks in AI development, potentially giving Musk a lock on its future direction. Does any government really want him to have exclusive control of AI’s development, especially given his track record of dabbling in politics?
There is also a big question mark over what the inclusion of SpaceX into benchmarks and indices do for the quality — and credibility — of these indices. Inclusion will likely bring a vast amount of risk into these supposedly robust investment options.
According to some commentators, the SpaceX stock surge marks the final departure of US stock valuations from reality. If so, the message for institutional investors still on the sidelines is clear: wait, and buy the dip.
