Damodaran: AI Hype Fading, SpaceX Has High-Potential Business
NYU professor Aswath Damodaran says AI-driven market hype is fading, but SpaceX's business model offers high potential, with his valuation at roughly half the current market cap of $2.7 trillion.
NYU Stern professor Aswath Damodaran warned that the artificial intelligence hype is losing steam, but highlighted SpaceX as a company with a high-potential business model. Speaking on Bloomberg TV, Damodaran noted that his recent valuation of SpaceX pegs its enterprise value at around $1.2 trillion and equity value near $1.3 trillion, roughly half of the current market capitalization of approximately $2.7 trillion.
SpaceX's market cap surged to about $2.7 trillion on its third day of trading, positioning the company to surpass Amazon in market value. Damodaran's analysis suggests that while the broader AI-driven rally may be overextended, SpaceX's unique position in space exploration and satellite communications gives it genuine long-term growth prospects. For equity traders, the wide gap between Damodaran's intrinsic valuation and the market price highlights the speculative premium embedded in SpaceX's stock. Investors can track real-time price movements of SpaceX and other high-growth equities on NowPrice's platform.
Looking ahead, market participants will watch for SpaceX's upcoming earnings reports and any updates on its Starship program or Starlink subscriber growth. Damodaran's comments also serve as a cautionary note for AI-related stocks, where valuations have been stretched by optimism. Key data points to monitor include the Federal Reserve's interest rate decisions and sector rotation patterns, as a shift away from growth stocks could pressure high-multiple names like SpaceX.