Can Tesla Bulls Strike Gold Twice? SpaceX IPO Puts The Elon Musk Premium To The Test

• Tesla holders with over 10 years in TSLA are getting special access to SpaceX's historic IPO through Morgan Stanley's E*TRADE.
• The IPO fulfills Musk's years-old pledge to prioritize retail investors and long-term Tesla shareholders.
• 'Dean of Valuation' Aswath Damodaran calls SpaceX a "loaded bet on AI and Elon Musk" but says momentum could still drive shares higher.

Five years after Elon Musk promised to give long-term Tesla, Inc. (TSLA) shareholders priority access to a future space venture IPO, some investors are finally getting their chance. The question now is whether SpaceX can do for them what Tesla once did.

After spending four of the year's first six months so far in the red, TSLA shares are staring down their worst year since 2022, despite a strong May rally that marked the stock's best month since September 2025.

Tesla Loyalists Get SpaceX Access

E*TRADE has informed qualifying clients that it has established a supplemental allocation process for SpaceX's upcoming IPO, allowing investors who have held Tesla shares in their accounts for at least 10 years to receive additional consideration when seeking shares in the offering.

The move comes as SpaceX prepares for what could be the largest IPO in history, raising a broader question that extends beyond the IPO process itself: are investors buying into a company, or are they once again betting on Elon Musk?

SpaceX plans to sell 555.6 million shares at $135 each, raising $75 billion and valuing the company at a massive $1.77 trillion. The valuation could also exceed $1.8 trillion on a fully diluted basis. The offering is scheduled to price on June 11, with shares expected to begin trading the next day.

Investor demand has reportedly been exceptionally strong after a JPMorgan-hosted roadshow, where Musk outlined plans to expand Starlink to more than 100,000 satellites and build orbital AI infrastructure. Analysts involved in the roadshow have apparently been fielding 20 investor calls per day, above the 10 to 15 calls typically seen for highly sought-after IPOs.

The filing itself painted an enormous vision for the company, outlining a $28.5 trillion market opportunity spanning launch services, Starlink connectivity, direct-to-cell communications and AI infrastructure. SpaceX called it the "largest actionable total addressable market in human history."

The filing added fuel to one of Wall Street's favorite Musk theories. SpaceX disclosed it may issue a significant amount of equity in future transactions, reviving chatter about potential stock-based deals and even a future merger of Musk's two most valuable companies. 

Musk's Retail Promise Comes Full Circle

The special allocation program traces back to comments Musk made in 2021 when discussing a potential SpaceX public offering: "At least a few years before Starlink revenue is reasonably predictable. Going public sooner than that would be very painful. Will do my best to give long-term Tesla shareholders preference," Musk said on X at the time. In another post from 2020, Musk favored retail investors by saying: "I'm a huge fan of small retail investors. Will make sure they get top priority [when SpaceX goes public]. You can hold me to it."

Alongside E*TRADE's special allocation process, Fidelity said the company has reserved up to 30% of the IPO for retail investors, far above the 5%-10% typically allocated in most high-profile listings. The larger retail allocation prompted Fidelity to lower eligibility requirements for participation to customers with as little as $2,000 in a brokerage account.

While SpaceX ultimately chose to take the parent company public rather than spin off Starlink, many retail investors view the allocation programs as a fulfillment of Musk's years-old pledge to give individual investors and loyal Tesla shareholders a seat at the IPO table.

The Elon Musk Premium

NYU professor Aswath Damodaran, deemed as the "Dean of Valuation," estimated SpaceX's equity value at $1.25 trillion to $1.35 trillion, below the IPO valuation. He said the company is "too richly priced" for his investment style at current levels. Still, Damodaran acknowledged that traders focused on momentum rather than intrinsic value may see things differently: "I would not be surprised in the least to see the offering priced at $1.8 trillion, and see a jump in the price on the day of or in the weeks after the offering," he wrote.

His broader conclusion was that SpaceX is ultimately a wager on Musk and AI: "There is no denying that this company is a loaded bet on the AI and Elon Musk," Damodaran said, adding that some investors may look at "Musk's track record with Tesla and feel the odds are in their favor."

A Backdoor Into The S&P 500?

The IPO frenzy comes despite a setback this week from S&P Dow Jones Indices. The index provider said it would make "no changes" to eligibility requirements for the S&P 500, S&P MidCap 400 and S&P SmallCap 600 after a consultation on newly listed megacap companies. The decision is significant since SpaceX reported a $4.94 billion net loss in 2025. Under existing rules, S&P 500 constituents must generate positive GAAP earnings in both the latest quarter and the trailing four quarters.

However, Tesla influencer Alexandra Merz, who posts on X under the handle TeslaBoomerMama, argued that S&P's decision may ultimately leave the timing of SpaceX's index inclusion in Musk's hands. 

"S&P will regret this," Merz said on X. "Now it's Elon deciding when SpaceX gets included, by merging with Tesla."

Merz said that S&P's decision leaves open an alternative route for SpaceX. Since Tesla is already an S&P 500 constituent, she said a future stock-for-stock merger between the two companies could allow the combined entity to inherit Tesla's place in the index, potentially accelerating SpaceX's path to inclusion. Notably, no such transaction has been proposed by either company. 

How Do Retail Traders Feel About TSLA And SpaceX?

On Stocktwits, retail sentiment for TSLA over the past six months has mostly been bearish amid over a 60% decline in message volumes in a year. Retail investors who have pinned TSLA on their watchlist have risen by a modest 2% over the past year. 

One user speculated anxiously, “will $TSLA pop tomorrow? Will enough retail investors have FOMO before SPACEX ipo thinking $TSLA will run and get it this week ?? I don’t know just a feeling…..”

Another user said, “$TSLA trades to nearly 400 trailing P/E and 200 forward P/E, TSLA is a cult stock so likely SpaceXAI will be too, it will 100% go up on the first day so if you buy in at the start and dump before the day is over you can net a tidy profit”

So far this year, TSLA stock has lagged its “Magnificent Seven” peers, making it the group’s second-worst performer, with a 7% decline.    

For updates and corrections, email newsroom[at]stocktwits[dot]com.

Read Next: RIVN Stock Snaps Record Streak: Rivian Reverses R1 Discounts Days Before High-Stakes R2 Launch