NEW YORK - SpaceX shares surged again on Tuesday, lifting Elon Musk's rocket company into the world's top five in market value for most of the session as a record-breaking IPO gives way to a torrid buying frenzy.
Shares of SpaceX, formally Space Exploration Technologies Corp., finished up nearly five percent at $201.80, giving it a market value of $2.64 trillion.
That placed the company a hair below Amazon's $2.65 trillion at the end of Tuesday's session after leading the online shopping platform most of the day. SpaceX also briefly eclipsed Microsoft, which is fourth on the list.
The latest rise came as SpaceX announced it will acquire artificial intelligence coding startup Cursor for $60 billion, a deal designed to further cement the Texas-based company near the nexus of the AI boom.
The SpaceX fever partly stems from enthusiasm over its growth potential, including AI. But at least as important are dynamics that have nothing to do with the company's operations or profit outlook.
"There is no valuation support for this market cap as it's all retail excitement meeting a very small float and no institutional sellers," said Eric Clark, a portfolio manager and chief investment officer at Accuvest Global Advisors.
"It's just a momentum trade and retail excitement plus active growth managers wanting exposure," Clark said in an email that described SpaceX's growth potential as a "five-to-10-year game."
Shares of SpaceX have soared more than a third in three sessions since last week's IPO, which raised a record-breaking $85.7 billion.
"There's a bit of a mania involving AI and anything that could be one of the beneficiaries of the spending on AI," said Steve Sosnick of Interactive Brokers.
Co-founded by Musk in 2002, the rocket startup has expanded into a major satellite operator and has also folded in Musk's artificial intelligence company xAI, which includes social media platform X.
- AFP