SpaceX went public in June 2026 in the largest initial public offering in history, raising about $75 billion at a valuation approaching $1.8 trillion, according to a filing with the Securities and Exchange Commission.
Add Tesla’s roughly $1.5 trillion market capitalization, and Elon Musk now sits at the center of more than $3 trillion in combined market value, 24/7 Wall St reported.
The mechanics of how SpaceX landed inside those retirement accounts traced back to a Nasdaq rule change earlier this year.
What sits inside those shares now deserves closer attention. The disclosure, buried in the company’s prospectus, has drawn scrutiny from governance experts and pension fund leaders who spoke to CNN.
SpaceX told regulators it may not be able to replace Musk
SpaceX’s IPO prospectus described Musk as essential to the company’s growth, innovation, and operational strategy.
The filing stated that finding a suitable successor with his abilities could be prolonged and uncertain, with no assurance of success, CNN reported.
Musk holds roughly 82% to 84% of SpaceX’s voting power through a super-voting share structure, which effectively prevents the board from removing him without his own consent, Motley Fool reported.
That concentration of control has drawn scrutiny from Nicolas Owens, an equity analyst for Morningstar, whose initiation note flagged Musk’s dual-class voting control and the related-party nature of the February 2026 xAI merger as governance concerns.
Tim Quigley, a professor of Strategic Leadership & Governance at the International Institute for Management Development, told CNN that investors are likely underestimating SpaceX’s key-person exposure.
<strong>I think the market is probably underpricing the risk</strong>.
Ross Gerber, CEO of Gerber Kawasaki Wealth & Investment Management, described the exposure in blunter terms, stating that a large portion of SpaceX’s value is tied directly to Musk.
Gerber told The Information that SpaceX has no succession plan and no future if Musk dies.
The forced-buying pipeline is already open
SpaceX joined the Nasdaq-100 on July 7, 2026, just 15 trading days after its public debut, in the fastest major index inclusion on record, CNBC reported.
Once a stock enters a major index, every fund tracking that benchmark must purchase shares at the prevailing price, regardless of valuation or fundamentals.
That mechanical buying pushed millions of retirement savers into a SpaceX position at roughly $160, well above the level the stock has traded at since July 2026, according to 24/7 Wall St.
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Buying flowed into the largest Nasdaq-100 trackers, including Invesco’s QQQ and the Invesco Nasdaq-100 ETF (QQQM). It also reached the Fidelity Nasdaq Composite Index Fund (FNCMX) and target-date or index sleeves within employer 401(k) plans that track the benchmark.
The S&P 500, in contrast, has not added SpaceX because the company does not meet the index’s profitability and public float requirements.
A 401(k) holding only S&P 500 index funds carries no direct SpaceX exposure, which makes the gap between benchmarks meaningful for retirement savers.
Morningstar’s numbers underscore SpaceX’s valuation gap
Owens assigns SpaceX a fair value estimate of $62, less than half its current trading price near $140.
That gap produces a price-to-fair-value ratio of roughly 2.3, making SpaceX one of the most expensive stocks in Morningstar’s coverage universe.
SpaceX posted $18.7 billion in revenue in 2025, alongside a net loss of $4.9 billion, with losses widening in the first quarter of 2026.
The firm has noted that SpaceX’s lofty valuation implies investors will need to wait decades for earnings to grow into the company’s multiples.
What Apple’s Jobs transition reveals about SpaceX’s blind spot
The closest historical comparison to SpaceX’s key-person exposure is Apple under Steve Jobs, who co-founded the company and led it until his death in 2011.
A fabricated 2008 post on CNN’s iReport, a user-submitted citizen-journalism platform, claiming Steve Jobs had suffered a major heart attack, sent Apple shares down roughly 10% in minutes, exposing the fragility of founder-dependent valuations, CNNMoney reported.
Tesla has shown similar sensitivity to news about Musk’s availability, focus, and commitment to the company’s core operations and long-term strategy.
Tesla shares lost roughly half their value between January and April 2025, when Musk shifted his attention to leading the Department of Government Efficiency, according to CNN.
He did not leave the company. He did not fall ill. He simply redirected his focus, and the market repriced Tesla accordingly.
Jobs, however, took steps SpaceX has not, building an internal executive training initiative known as Apple University years before his resignation, which came six weeks before his death.
By the time Tim Cook formally took over in August 2011, Wall Street viewed him as a credible successor, and Apple stock recovered quickly.
Craig Crossland, John V. Roach Dean of Neeley School of Business at Texas Christian University, told CNN the central question is whether Musk’s vision has been institutionalized.
When asked if that transfer of leadership capability had occurred, Crossland said, “I don’t think we’ve had the opportunity to see that.”
What SpaceX’s succession gap means for your retirement savings
The weak spot is not hidden. It is named in the SpaceX prospectus, visible in the January-to-April 2025 Tesla chart, and locked in place by supermajority voting control that outside shareholders cannot dilute.
The key-person risk disclosed in SpaceX’s prospectus, as CNN reported, reaches anyone holding Nasdaq-100 exposure in a retirement account.
Dan Ives, partner and senior managing director at Yorkville Ives & Co., told CNN that investors treat the key-person risk as a background factor rather than an active threat.
But it remains embedded in every share, and SpaceX will eventually have to address succession publicly.
Morningstar’s fair value estimate leaves passive investors carrying a valuation premium that the company’s own admissions do not underwrite.
That exposure is present even when SpaceX does not appear in a fund’s top-line name, and fund-level holdings reports are the only place it surfaces at the plan-participant level.
