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SpaceX and OpenAI are reportedly preparing for what could become two of the largest initial public offerings (IPOs) in U.S. history by initial market value. While the listings could attract major attention, the historical record suggests investors may face sharp post-listing declines and long-term underperformance risk if they buy immediately.
SpaceX has already filed IPO paperwork and is on pace to list shares in Q3 2026. Earlier this year, the rocket and satellite company merged with xAI, creating a combined entity valued at $1.25 trillion. According to The Information, SpaceX posted a $5 billion loss on $18 billion in revenue in 2025, implying a price-to-sales (PS) ratio of 69.
OpenAI has not filed IPO paperwork, but it could go public as soon as Q4 2026. The company’s latest funding round closed with a post-money valuation of $852 billion. OpenAI reported that sales rose 225% to $13 billion in 2025, and it expects revenue to more than double in 2026. Even so, the company’s PS multiple is currently 65, and it does not expect to turn a profit until 2030.
For context, only one stock in the S&P 500 currently trades at a more expensive valuation than SpaceX and OpenAI: Palantir Technologies, at 75 times sales. That means SpaceX and OpenAI would likely enter public markets with extraordinarily high valuation ratios relative to most large-cap peers.
Since 2000, nearly 4,000 companies have completed IPOs on U.S. exchanges, according to Jay Ritter, director of the IPO initiative at the University of Florida. IPO stocks gained an average of 30% on their first trading day.
However, that initial enthusiasm often fades as investors take profits. The article cites data showing that the 10 largest U.S. IPOs by initial market value experienced median declines of 11% over the three months following their debut and 26% during their first year as public companies.
The article notes that Alibaba’s IPO valued the company at $169 billion. At their current market values, SpaceX and OpenAI would be positioned to become the largest IPOs in U.S. history. Based on the referenced historical chart, the article estimates a 50-50 chance the stocks could drop at least 26% from their day-one closing levels over the next year.
The article also highlights that many of the largest IPOs have underperformed the S&P 500 after going public, suggesting investors might have been better served by buying an S&P 500 index fund rather than the IPO shares themselves.
By contrast, the article says Meta Platforms, Arm Holdings, and Enel have beaten the S&P 500 since their IPOs. It also notes that the long-term performance of AT&T Wireless cannot be determined because it was acquired by Cingular, which later changed its name to AT&T Mobility and became a wholly owned subsidiary of AT&T.
SpaceX and OpenAI are among the most anticipated IPOs in recent memory, and the initial trading period could bring rapid price gains. Still, the article argues that large IPOs have often been poor long-term investments for investors who buy right away, and it suggests waiting for a more reasonable entry point rather than immediately chasing the first-day momentum.
As an example, while Uber has underperformed the S&P 500 since its IPO, the article states the stock is up 143% over the last three years, essentially doubling the S&P 500’s return—implying that investors who waited for a better entry may have benefited.
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