- Veteran investor Ron Baron revealed plans for a $1 billion SpaceX IPO investment and said the company could become “the largest company on the planet.”
- Speculation around a potential Tesla-SpaceX merger intensified after Elon Musk said he was in a “quiet period” and could not comment on reports of a SpaceX S-1 filing.
- Retail investors are debating whether to sell Tesla shares to fund potential SpaceX IPO purchases, with sentiment for TSLA bearish and for SpaceX extremely bullish.
Tesla shares edged higher in overnight trading Wednesday as speculation swirled around a potential SpaceX IPO and merger with the electric vehicle maker. CEO Elon Musk fueled the buzz during a recent Forbes OpenAI/”>interview by stating he was “not allowed to comment on these things. It’s like a quiet period or something to that effect.”
Consequently, veteran investor Ron Baron further ignited interest by revealing his plan to place a $1 billion order at the IPO price. Baron stated in an interview that SpaceX could become “the largest company on the planet” and that its Starlink unit alone could be worth $14 trillion to $15 trillion.
However, the merger speculation has divided Wall Street. Deepwater Asset Management’s Gene Munster believes there’s a greater than 50% chance of a deal within five years. Meanwhile, Gary Black of The Future Fund warned a merger could trigger a 25% downside for Tesla shareholders due to valuation multiple compression.
The debate has spilled into the retail community, where investors are weighing whether to sell TSLA shares to fund SpaceX IPO purchases. On Stocktwits, sentiment for Tesla was bearish, while sentiment for SpaceX remained extremely bullish.
One user noted that Tesla was previously the only public vehicle for Musk exposure, a dynamic now disrupted. So far this year, TSLA stock has declined 10%, making it the second-worst performer among the “Magnificent Seven” peers.
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