Cathie Wood Is Buying SpaceX Stock as it Sinks 50% Below Its Post-IPO High. Should You Follow Her?
Cathie Wood's company, Ark Invest, is buying SpaceX stock despite its 50% decline from its post-IPO high. Wood loves disruptive tech stocks and sees SpaceX as a key player in the space economy.
Intelligence analysis by Llama
Cathie Wood's company, Ark Invest, is buying SpaceX stock despite its decline. Wood sees SpaceX as a key player in the space economy and believes it has the potential for 'hundreds of billions of dollars in gross profit by 2030'.
Cathie Wood's company is buying SpaceX stock because she thinks it's a good investment. She likes companies that are changing the world and making new things. SpaceX is making reusable rockets that can go to space and back, which is a big deal. But the company is still losing a lot of money, so it's not clear if it's a good time to buy the stock.
Analysis
Cathie Wood's Love for Disruptive Tech Stocks
Cathie Wood's company, Ark Invest, has been scooping up shares of SpaceX lately. Wood loves disruptive tech stocks, which she sees as driving the future. She was an early Tesla fan and clearly admires Elon Musk for his vision and technical execution.
Why Cathie Wood Loves SpaceX
Wood sees SpaceX as a key player in the space economy. She believes that the company's reusable rockets and declining costs will lead to 'hundreds of billions of dollars in gross profit by 2030'. This is likely why SpaceX's astronomical valuation doesn't bother her. Even at today's lower price, SpaceX stock trades at a price-to-sales ratio of 77, higher than the most expensive stock in the S&P 500 on a price-to-sales basis, Palantir Technologies, at 57.
Is it Time to Buy SpaceX Stock?
Wood loves high-risk, high-reward stocks, and SpaceX is no exception. However, the company is still reporting high losses, and its valuation is already quite high. It's too early to buy SpaceX stock, even if you believe in its opportunities. There's a lot of growth built into its price, and it's a while off from turning a profit. If the valuation becomes more attractive and the company approaches profitability, you can reevaluate.
Key points
- Cathie Wood's company, Ark Invest, is buying SpaceX stock despite its decline.
- Wood sees SpaceX as a key player in the space economy and believes it has the potential for 'hundreds of billions of dollars in gross profit by 2030'.
- SpaceX's valuation is already quite high, and it's still reporting high losses.
- It's too early to buy SpaceX stock, even if you believe in its opportunities.
If SpaceX can turn a profit and continue to innovate, its stock price could increase significantly. Cathie Wood's investment in the company could also lead to a surge in its stock price if her predictions come true.
If SpaceX continues to lose money and its valuation becomes even more astronomical, its stock price could decline further. Additionally, if the company's technology doesn't live up to expectations, its stock price could also decline.
