Former hedge fund manager and CNBC host Jim Cramer made some interesting comments about SpaceX shares. Cramer thinks that it is not too late to buy SpaceX stock following the company’s initial public offering (IPO), adding that investors should view this stock not as a short-term play based on earnings and profit expectations, but as a long-term investment in the future of space exploration.
“Is it too late to buy SpaceX? If you’re ready to view this as a different kind of stock rather than a short- or medium-term investment, then you have my approval”, Cramer said in his statement.
SpaceX began trading on the Nasdaq on Friday, opening at $150 per share. The stock rose as high as $176 during the day, bringing the company’s market capitalization to $2.1 trillion at the close. Its strong performance has reignited discussions about whether the stock’s valuation has risen too much relative to SpaceX’s current financial results.
“SpaceX investors are aware that the company won’t turn a profit for some time”
According to Cramer, investors are drawn to SpaceX not only because of its current profitability but also due to their confidence in Elon Musk’s long-term vision and the projects expected to materialize over the years. Cramer described it as “a long-term bet on space exploration.”
The CNBC host also added that investors are aware of the risks associated with the company and have factored in the possibility that the company could continue to operate at a loss for an extended period. Nevertheless, Cramer argued that for investors who believe in the long-term growth story, pullbacks in the stock price should be viewed not as a reason to sell, but as a buying opportunity.
“If it drops, you should buy more,” Cramer said. “Because the upside potential is almost unimaginable.”
Meanwhile, Cramer also praised the performance of Goldman Sachs and Morgan Stanley during SpaceX’s IPO process. According to Cramer, both banks successfully managed the balance of demand between institutional and retail investors, and the opening price settled at a reasonable level compared to the IPO price.
