Jeremy Grantham labels the SpaceX IPO as the "craziest" in history while predicting a significant long-term price crash.
Jeremy Grantham, the founder of Grantham, Mayo, Van Otterloo & Company (GMO), expressed significant skepticism regarding the recent SpaceX initial public offering. Describing it as "the craziest IPO in the history of man," Grantham criticized the company's high valuation and its ambitious, sci-fi-sounding goals such as asteroid mining and space tourism. While Grantham acknowledges that new indexing rules—specifically SpaceX joining the Nasdaq-100—could create a short-term demand surge, he remains a "permabear" on the long-term outlook. He argues that the company's massive artificial intelligence spending and negative earnings will eventually cause the stock to drop hard. He specifically noted that SpaceX's AI division is currently "third-rate" compared to industry leaders like OpenAI. Despite Grantham's pessimism, other analysts remain optimistic. Morgan Stanley initiated SpaceX as an "overweight" position with a $300 target price, while Goldman Sachs and JPMorgan also issued "buy" ratings. However, experts warn that investors must remain patient, as the company may not become cash flow positive until 2035.