With the reversal of supply and demand in the US stock market over 23 years, what are Wall Street’s real cards under the epic SpaceX IPO?
Musk is set to take SpaceX public on Nasdaq this week (expected share price $135, raising up to $75 billion), alongside Anthropic's confidential S-1 filing, with OpenAI following closely. The media is shouting: the century’s tech feast is here! Or is it a liquidity black hole with the US stock market about to crash?
This black-and-white viewpoint does nothing to help your investments, aside from grabbing attention.
If you’ve noticed recently, the market cap of Mag 7 has evaporated by trillions after SpaceX filed its S-1, marking a bloodless capital migration.
It can be said that Goldman’s data hits a soft spot for US stocks; over the past 20 years, the underlying code for the long bull market has been a long-term negative net supply of stocks (companies crazily repurchasing and retiring shares, shrinking the denominator, passively pushing up EPS).
But now, AI has turned into a cash-devouring abyss. Alphabet has just completed a historic $85 billion equity financing (surpassing Petrobras's record in 2010). Meanwhile, Meta is also considering a similar massive financing.
Goldman Sachs predicts that by 2026, the net supply of US stocks will officially turn positive, with this year’s IPO financing expected to hit a record $225 billion.
It's not that the market is out of money; it's that the reservoir of stock supply has been opened. With the simultaneous arrival of new stocks (SpaceX, OpenAI) and the giants’ additional issuances, the total amount of funding is limited, inevitably leading to structural pressure in the market.
Professor Jay Ritter from the University of Florida has compiled data from nearly 10,000 IPOs from 1980 to 2025, providing a hard indicator for the frenzy of capital.
Historically, whenever a company’s price-to-sales ratio at IPO exceeds 40x, its stock price averages a 44.8% drop three years later, underperforming the market by nearly 60 percentage points.
Let’s take a look at SpaceX’s upcoming GAAP data:
1, 2025 revenue: $18.7 billion
2, 2025 net loss: $4.9 billion (mainly due to xAI and AI infrastructure burning over $2 billion each quarter)
3, Target valuation for the IPO: $1.75 trillion
4, Dynamic Price-to-Sales ratio: as high as 93.5x!
This completely surpasses the right limit of Jay Ritter's chart.
Historical patterns tell us that this record ultra-high premium financing often indicates a peak in private valuation, and early VCs urgently need to seek public market liquidity to offload typical bubble characteristics.
In the face of this huge historic divergence, what are the top institutions doing? Are they liquidating traditional giants and going all-in on SpaceX?
Traditional institutions are definitely not liquidating traditional giants. According to the latest SEC disclosures, traditional top institutions have made extremely precise cuts to marginal liquidity while maintaining their core holdings.
1, Buffett's Berkshire Hathaway: Ultimate defense and precise embedding
Berkshire is not wildly chasing startup IPOs, but they made a market-shocking move—directly subscribing to $10 billion in Alphabet's historic $85 billion equity financing through targeted private placements.
This $10 billion injection has pushed Alphabet into the top five holdings of Berkshire’s stock portfolio, accounting for nearly 10% of its overall equity investments. Buffett is showing with real action: not buying into unlisted bubbles, but doubling down on traditional AI giants that have a strong moat and are undergoing historic financing.
2, BlackRock: Marginal withdrawal in the 13F report
BlackRock's overall Mag 7 holdings amount to hundreds of billions. However, in the last quarter, they slightly reduced their public market positions in Meta and Alphabet by 3.2% and 4.1%, respectively.
Where has this money gone?
The tens of billions released through profit-taking have been precisely allocated to their actively managed primary market funds. According to leaked data from the media and underwriting syndicates, BlackRock has already locked in about $3.5 billion of cornerstone investor equity in SpaceX's historic $75 billion IPO.
Vanguard: Passive following and active tweaking
Vanguard's active tech fund has actively reduced its weighting in traditional hardware stocks (like Apple) by 1.5 percentage points in the latest quarterly report.
They are directing this freed-up capital into the secondary market and the upcoming IPO, locking in about $2.5 billion of SpaceX shares to satisfy their high-net-worth clients' defensive allocations to scarce space sovereignty assets.
This post is purely to share a different perspective; seeing this, what’s your take?