Today is a day for the history books.
NASA launched astronauts into space on a commercially built rocket and commercially built crew capsule. SpaceX, the aerospace company founded by
CEO Elon Musk, built the equipment.
This was the first crewed launch from American soil since 2011, the year the iconic space shuttle was retired.
It has been quite a journey for SpaceX. The company first reached orbit around 2008. The company successfully landed a rocket it sent into space around 2015. Reusable rockets—pioneered by SpaceX—are helping to drive down launch costs, opening up space to new companies in industries from telecommunication to tourism.
The milestones continued from there. In 2018, SpaceX even launched a Tesla (ticker: TSLA) car into space. Musk has always found a way to generate buzz for Tesla without spending money on commercials, saving the electric vehicle pioneer billions of dollars.
In 2019, Tesla completed the Dragon Demo 1 mission. Saturday began the Dragon Demo 2. If all goes well, SpaceX will be certified by NASA to fly cargo and crew to the international space station. The Dragon space ship is scheduled to dock with the station on Sunday before returning to earth.
The weather was looking a little sketchy for a while. Weather forced an attempt on Wednesday to be aborted. It isn’t as simple as a little rain. NASA tracks winds, electrical fields, rains, and clouds at the launch site and all the way up the eastern seaboard in case the mission needs to be aborted.
Ultimately, the launch went off on schedule at about 3:22 Eastern time. It took about 10 minutes for the astronauts to reach orbit. Speeds reached 1,000 kilometers an hour in about one minute. NASA uses kilometers per hour. All that means it took the rocket about 1 minute to break the sound barrier.
The Launch America broadcast offered live views into the 27-foot tall Dragon spaceship. Speed reached more than 12,000 kilometers per hour in just 6 minutes.
The broadcast also offered a view of the Falcon rocket, which was returning to earth.
It was all, quite frankly, breathtaking. The line “go for launch” was followed by the astronauts “let’s light this candle.” It gave Barron’s goosebumps.
We imagine Musk feels quite proud. He is having quite a year. In addition to SpaceX’s Saturday milestone, stock in his publicly traded company—Tesla—is up just under 100% year to date.
That would be the best return in the
Dow Jones Industrial Average
so far in 2020 if Tesla was in either index. It isn’t. But getting in the S&P might be the next feather in Musk’s cap. A decent second quarter would give the electric vehicle pioneer positive income over the past four quarters, something required for S&P 500 inclusion.
Even though Tesla isn’t in the Dow or the S&P it is the second most valuable car company in the world with a market capitalization of more than $150 billion. Only
(TM), with a market value of more than $200 billion tops Tesla.
SpaceX is worth about $36 billion based on a recent capital raise. That is big for space. NASA’s 2021 budget request ask for about $25 billion. The budget doesn’t represent value. It could be, instead, a proxy for sales. What’s more, most mature aerospace companies trade for about 1.5 times sales, making NASA’s theoretical value about $35 billion to $40 billion.
SpaceX sales aren’t know, but the company is taking in millions of dollars. The company, for instance, recently won a $135 million award from NASA to develop a Mars lander that will use a SpaceX super heavy rocket.
For investors, the launch demonstrates that space—as an investing theme—is here to stay. Reusable rockets—pioneered by SpaceX—and reusable space capsules are driving down launch costs. Satellites are getting cheaper to manufacture, too.
Write to Al Root at firstname.lastname@example.org