SpaceX has borrow going into initial lockup expirations and the rates are surprisingly cheap.

The maintenance margin is high so this cannot be levered, but shares of Space X are remarkably cheap to borrow in sizes that dwarf the majority of retail account sizes. I was surprised to see the cost to borrow shares on IBKR wasn't above 1%. I doubt SpaceX is going to suddenly trade lower as is desireable in most circumstances when going short stock, but I wouldn't be shocked to see it bleed lower for a long time. I think the rockets landing are pretty cool but this thing isn't worth 400x its TTM ebitda.

The business without the AI stuff puts a floor on SpaceX (alongside their girthy balance sheet) because that segment actually has positive operating margins, but even a 300x multiple on those earnings makes SpaceX worth significantly less than what it is trading for today. It also remains tbd how good starlink actually is as a businessness due to their short lifespan & the depreciation of literal rockets. If the maintenance capex is overwhelming it could make that operating income an illusory figure.

The sheer size is also at a point where discount rates as low as 5% require SpaceX to generate quantities of free cash flow that seem mathematically impossible. And in an attempt for buying revenue alongside the underwriters essentially betraying society by lying for fees in the S-1 investment banks signed off on, SpaceX is smashing their balance sheet into hastily building poorly managed AI data centers powering Grok and twitter subscriptions. This is turning out to not be a great business, so I do not think it will be what SpaceX does forever but it doesn't help the valuation.

Going into the unlock next month, almost everyone that made off well here is the stock markets version of being house rich and cash poor. A lot of them will start selling into bids that have only been propped up by a low float speculative bid on a super hot IPO thats been advertised globally.

Silly as it is Musk also represents key man risk insofar as the center piece of the cult of musk & his businesses prices. The man is growing increasingly erratic, he probably broke federal law with DOGE (not that I expect it to be enforced against him), and in the event he ends up passing away or getting in actual legal trouble for the first time ever it would probably cut the stock in half. I do not have a large position against SpaceX but I am short shares.