Jim Cramer backs SpaceX stock after $2.1 trillion Nasdaq debut, urges investors to buy dips
Cramer told investors any pullback in SpaceX shares should be treated as a buying opportunity
SpaceX made its Nasdaq debut on Friday, opening at $150 per share before surging as high as $176, and closing the session with a market capitalisation of $2.1 trillion. The powerful first-day rally quickly reignited concerns among analysts that the stock's valuation had outpaced its current financial performance. Mad Money Host Jim Cramer, however, moved swiftly to defend the stock's long-term appeal to investors willing to look beyond near-term results.
Cramer's case for SpaceX
Cramer framed the investment not as a conventional trade but as a generational bet on the future of space. "Is it too late to get into SpaceX?" he said on Mad Money. "If you're willing to look at this as a different kind of stock, not a short or even medium term investment ... then you've got my blessing."
He argued that buyers are not focused on Elon Musk's company's present-day losses or cash outflows, but rather on a pipeline of projects that may take years to fully materialise. "This is a long-term call on space exploration," Cramer said. He acknowledged that losses may persist for the foreseeable future, adding: "I think they've considered the risk and recognized that there could be losses as far as the eye can see."
Buy the dip, Cramer says
For investors who share that long-term outlook, Cramer said any share price weakness should be welcomed rather than feared. "If it comes down, then you should buy more because the upside is conceivably unfathomable," he said.
He noted that the strong debut reflected shareholders' belief that SpaceX's future opportunities could far exceed what is currently reflected in the business, even if sceptics continue to question its valuation.
Praise for Goldman and Morgan Stanley
Cramer also reserved praise for the two banks that led the IPO — Goldman Sachs and Morgan Stanley — crediting them with striking the right balance between institutional and retail demand while avoiding the kind of chaotic first-day surge that can create longer-term problems.
"The stock opened at a reasonable price versus the IPO price, not so high that it would encourage flipping but not that low as to foment panic," he said. "That's amazing." It is worth noting that Cramer's Charitable Trust, the portfolio used by the CNBC Investing Club, holds shares in Goldman Sachs.
