Should you buy space stocks ahead of the SpaceX IPO?

Have you seen space stocks recently?

They’ve been some of the hottest names in the market. SpaceX competitor Rocket Lab (RKLB) is up 240% in the last six months. Space infrastructure stock Redwire (RDW) has soared 306%.

And miniature satellite builder Sidus Space (SIDU) has surged 760%.

A lot of this buying is tied to the hype around the coming SpaceX IPO. Investors are treating public space stocks as a backdoor way to get exposure before Elon’s rocket company hits the market.

It’s not too late for you to join them.

Not because you can still squeeze out a quick gain before SpaceX goes public in two weeks.

Because a much bigger opportunity is waiting on the other side of the IPO.

Forget asteroid mining and moon bases.

Those are decades-away ambitions.

The biggest opportunity for investors right now is data centers in space.

I know, it sounds far-fetched.

But disbelief is often where the best investment opportunities begin.

In 2012, the obvious take on Facebook was that advertising would never work on tiny phone screens. The desktop era was over, mobile was too small, and Facebook had no real business model.

That “obvious” truth was dead wrong.

Investors said the same thing about Tesla. Nobody believed an electric car company could build vehicles people would buy at scale.

That was wrong, too.

The best disruptors often rise for years while the market insists they can’t possibly work.

It won’t be any different with data centers in space.

Once you look at what’s happening with AI here on Earth, it makes sense.

Data centers powering modern AI are some of the most resource-hungry buildings on the planet.

Meta is building a campus spanning more than 4 million square feet — roughly the size of a major airport terminal.

Inside, these facilities are packed with tens of thousands of server racks… hundreds of thousands of AI chips… and enough networking gear and cables to rival a small industrial city.

They consume extraordinary amounts of electricity. ChatGPT consumes enough energy to power 4.4 million US homes every day.

And that’s just one model!

Data centers also generate tremendous amounts of heat. A single data center can easily burn through a billion gallons of water a year just for cooling — enough to drain the entire Central Park Reservoir.

Running data centers requires constant upgrades to surrounding infrastructure. New land. Permits. Transmission lines. Power plants. And water that may already be in short supply.

And that’s before you run into dreaded NIMBYs: the “not in my backyard” folks. People may love using AI tools, but they feel differently when a giant data center breaks ground next door.

Space solves all these problems.

A data center in orbit can tap directly into the largest power source available: the sun.

It works 24/7/365. No land required. No NIMBYs. No competing with homes or factories for electricity. Space is also a cold -455 degrees Fahrenheit. This eases one of the biggest data center costs: cooling.

The biggest obstacle so far has been launch cost. But SpaceX’s new Starship rocket will lower that cost by 4x–9x. That would bring space-based data centers close to cost parity with Earth-based facilities.

Put it all together, and you should take the idea of data centers in space seriously.

We’re talking about decades of infrastructure spending that will still be here long after the SpaceX IPO buzz fades.

Obviously, data centers in space will be great business for SpaceX.

In 2025, it set a new annual record with more than 170 launches. SpaceX carried over 2,600 tons of cargo into space. Elon is basically running an orbital “FedEx.”

Every big tech firm wanting to send data centers into space will have to pay SpaceX.

But don’t buy SpaceX.

It’s the most anticipated IPO ever. Everyone will invest in.

Meanwhile, there are many smaller, under-the-radar disruptors who will profit just as much if not more.

Once you start considering all the things an orbital data center would require, you realize an entire support economy must form around it.

You’re not just tossing servers into orbit and flipping a switch. The hardware has to survive launch and then assemble itself properly in orbit.

Then comes maintenance. On Earth, if a server breaks, a technician walks over and swaps the part. In space, every repair becomes a mission.

And hardware never lasts forever. Parts fail. Systems age. Technology moves on. Some equipment will need to be upgraded or safely brought back down to Earth.

That creates demand for a whole new class of space businesses.

Think companies that build robotic arms and docking systems to connect modules in orbit… and companies that provide repair services, logistics stations, and docking equipment.

That’s the big opportunity. It’s where investors’ attention will turn once the SpaceX IPO is in the rear-view mirror.

Thank you for reading.