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113% in NEXTERA in 2 days. 100% in Gilead Sciences in 3 days. 151% in Microsoft in 2 days.
SpaceX plans to borrow at least $20 billion.
Bankers for the company are preparing to call investors as soon as Monday to pitch a bond offering, according to Bloomberg. It would be SpaceX's first-ever investment-grade dollar bond — a notable step for a company that was private until eight days ago.
Why is SpaceX borrowing more money?
SpaceX took out a temporary $20 billion bridge loan that comes due in September 2027. A new bond would refinance this existing debt. That bridge makes up most of the company's $29.1 billion in long-term debt as of March 31, per the IPO filing.
Bridge loans are short-term and expensive by design.
Swapping one for longer-dated bonds at investment-grade rates is exactly what you'd expect a capital-heavy company to do once it can. SpaceX has told investors it already lined up investment-grade ratings from three major graders, which is what allows for the cheaper borrowing.
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The same five banks that wrote the bridge — Bank of America, Citi, JPMorgan, Goldman Sachs, and Morgan Stanley — are expected to run the bond offering.
Why now? The filing says capital spending will rise "substantially," funded by a mix of debt and equity. Starship, Starlink, and the AI buildout from the xAI acquisition all need cash. Establishing a track record in debt markets early gives SpaceX a cheaper, repeatable way to fund all of it.
As for the stock — SPCX closed at $185.00 today, down 3.6%. That's a second straight down day after the post-IPO run.
Yet it’s still 37% above the $135 IPO price. The bond news didn't drive the dip; the pullback was already underway. Two different stories landing on the same day.
I'll be watching the actual bond terms when they price next week — the coupon will tell us how the market really rates this company.
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Editor, IPO Watch