SpaceX is expected to go public this summer at a valuation that could reach $1.75 trillion. With up to 30% of shares being reserved for smaller retail investors, millions will have the chance to invest in SpaceX stock.
The SpaceX IPO should be great news for nuclear power stocks like NuScale Power (NYSE: SMR). Why? SpaceX and its new horde of capital will put a spotlight on the exact problem that NuScale is racing to solve.
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Here’s how the SpaceX IPO could help NuScale Power
There’s an opportunity for SpaceX to achieve a $1.75 trillion valuation this summer, making it one of the biggest IPO stocks in history. But this isn’t the opportunity you should be paying the closest attention to. In fact, SpaceX has yet to officially file a public prospectus, making its full financial situation clear for potential investors. In the meantime, investors should consider which stocks are set to benefit from SpaceX’s historic IPO.
I already detailed how SpaceX’s fresh cash from a public share sale — which some experts believe could reach $75 billion — will create a massive spending spree, benefiting two stocks in particular. But it’s not just cash that SpaceX will be deploying; it’s also attention. Following its IPO, SpaceX is expected to pursue some truly wild growth opportunities, including a human base on the moon and orbital data centers. It’s the latter — orbital data centers — that could end up generating plenty of positive buzz for NuScale Power.
Data centers are energy-intensive, largely because they require so much cooling. SpaceX wants to launch data centers into space, taking advantage of space’s low ambient temperatures.
I’m not sure SpaceX will ever be able to make orbital data centers a reality. “Developing its space-based orbital data centers is one of the major drivers behind SpaceX’s IPO plans, as the endeavor is expected to be highly capital-intensive and technologically challenging,” observes a recent report from Reuters. Many physicists worry about radiation and other space-based challenges.
Regardless of whether SpaceX is successful in this regard, it will surely bring new attention to the AI industry’s desperate need to either reduce the energy intensity of data centers or bring new energy sources online. While relatively unproven and innovative versus conventional power plants, NuScale’s approach to nuclear — which uses small modular reactors, or SMRs — has far more real-world proof points than orbital space centers. Two SMR plants are already operational in Asia, and many dozens are currently in the financing, permitting, or construction stages worldwide.
