SpaceX filed confidentially to go public at the beginning of April, and its IPO is set to shatter market records.

The Elon Musk-led company is reportedly targeting a valuation of as much as to $2 trillion and raising up to $75 billion.

SpaceX has been one of the most eagerly awaited IPOs, along with OpenAI and Anthropic, but it’s not the winning investment you might think it is.

Based on revenue of approximately $15.5 billion-$16 billion last year, SpaceX could debut at a price-to-sales ratio of more than 100, which would make it far more expensive than any stock on the S&P 500, even Palantir, which currently trades at a P/S ratio of 77.

SpaceX could fetch that valuation because of Elon Musk’s visionary leadership and the company’s bold goals of achieving things like colonizing Mars and sending data centers into space, as dubious as they might be. The company is widely considered the leader in modern rocket technology and pioneered the use of reusable rockets, which have significantly lower costs. Meanwhile, Starlink, its satellite internet division, is the leader in that industry and is the source of most of SpaceX’s revenue. The company also owns xAI, following a merger earlier this year, which owns the X social media site and the Grok AI chatbot.

However, SpaceX’s valuation could be a bitter pill to swallow and is likely to pressure the stock once it goes public. One stock that looks like a better alternative to SpaceX is Amazon (AMZN 1.08%).

How Amazon stacks up with SpaceX

What’s attractive about Amazon in comparison to SpaceX is that Amazon Leo, formerly known as Project Kuiper, is considered Starlink’s closest competitor.

Amazon has launched hundreds of satellites into orbit and is currently providing an enterprise beta service for select business partners as it tests its service, meaning Leo is currently only generating minimal revenue.

However, Leo is believed to be on the verge of commercial service, and JetBlue said it would be the first airline to use Amazon Leo for in-flight Wi-Fi starting next year, a sign that Amazon will likely be selling to other customers. The company also showed it’s serious about the satellite internet business with its $11.6 billion acquisition of Globalstar earlier this month.

Amazon doesn’t have a rocket business like SpaceX, but Founder Jeff Bezos owns Blue Origin, another space technology company, and it’s easy to see a merger between it and Amazon happening if the rocket business were seen as attractive enough.

Amazon isn’t considered a major competitor in frontier models, but it is a major investor in Anthropic. After investing $8 billion in Anthropic earlier, it has just reached a deal with the AI start-up to invest $5 billion now, with up to $20 billion more in the future as milestones are reached. For investors looking for exposure to AI, that could be more attractive than SpaceX’s ownership of xAI.

Amazon

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Current Price

$261.14

What else Amazon owns

Of course, Amazon’s value comes from its dominance in e-commerce and cloud computing, which made it the biggest company in the world by revenue in 2025, and generated $77.7 billion in generally accepted accounting principles (GAAP) net income.

Amazon has a market cap of $2.8 trillion currently and trades at a price-to-earnings ratio of 36, meaning that investors are getting ownership of one of the most dominant companies in the tech industry, with emerging growth opportunities and its stake in Anthropic virtually for free.

Amazon’s net income was roughly five times larger than SpaceX’s revenue last year, yet SpaceX is targeting a valuation that’s only about a third less than Amazon. It seems hard to justify SpaceX’s valuation when you look at it that way.

While SpaceX is certainly doing some exciting things with rockets and satellites, the valuation seems unsustainable. If you’re looking for exposure to those businesses without the risk, Amazon looks like the much better choice.