Tesla and SpaceX carry a combined market cap that has given global media outlets the green light to report on an unprecedented coronation – a single human has become a trillionaire. But it’s a simple valuation that carries with it more weight than it perhaps should.

On most modern measures, Musk has eclipsed John D Rockefeller as the world’s wealthiest individual in the Modern Age. Unlike Rockefeller, Andrew Carnegie or Henry Ford, however, Musk draws no income by way of dividends. Not only does Tesla reinvest profits and not pay dividends, but even if SpaceX were profitable, its S-1 filing states that covenants under its current credit agreements restrict its ability to pay dividends.

Instead, Musk relies on sky-high stock valuations to pledge his holdings as collateral to access loans, obsessively holding onto stock and control and avoiding the usual trappings of wealth. While Citadel’s Ken Griffin has amassed a $1.5b global property portfolio, Musk owns a small property portfolio and famously claims his principal place of residence is a leased 20 x 20-foot prefab home in Texas, on SpaceX’s Starbase compound.

In February Musk tweeted that his net worth is <0.1% in cash, and that was when his estimated net worth was probably 75% of what it is today – still would amount to an eyewatering amount of cash, but not what the typical back-of-the-napkin income calculation from one trillion dollars might suggest.

The media-hype that supports the myth

SpaceX says that its valuation is supported by a US$28.5 trillion total addressable market. Parts of this market do not exist today, which the IPO filing concedes – in-orbit manufacturing and data centres, lunar/Mars energy and manufacturing, and asteroid mining, are theoretical elements in some wildly-successful future version of today’s SpaceX business.

With Tesla, which trades on a ~340x price to earnings (PE) multiple, and roughly 15 times the auto manufacturing industry average on a forward earnings multiple basis, investor optimism focuses on autonomous robots, robotaxis and future energy storage. These endeavours are a little closer to planet earth, but they’re nowhere near a reflection of the current business.

Musk’s businesses trade on narrative, not on fundamentals. Celebrity status and consumer fascination with concentrated wealth have created a media landscape where it has proven irresistible to cover every publicly available fact, figure and fever dream associated with the life of Elon Musk.

A couple of trading sessions in (at the time of writing) and business desks were not debating whether a loss-making company should be worth more than US$2 trillion, rather they were busy redrawing the map of the market to make room for it. As SpaceX vaulted past Meta and Tesla, the media scrambled to create new acronyms. Forget Magnificent Seven and FAANGs, journalists are now making way for MANGOS – Meta, Anthropic, Nvidia, Alphabet, OpenAI and SpaceX. Less catchy but also getting a run is Magna Atoms, a reference to the legacy Magnificent Seven combined with the newcomer ‘Atoms,’ simply a reference to a new breed of physical and digital tech heavyweights.

It’s a small detail in the grander scheme of things, but faced with a SpaceX valuation that defies logic, the press responded by reaching for the thesaurus rather than scepticism.

The index problem

In March 2026, Nasdaq changed its rules – first, to cater broadly to SpaceX, OpenAI and Anthropic, it said it would allow newly listed companies to join the top 100 after 15 trading days, rather than three months – a 77% drop in the time investors will have to watch price discovery play out before its Nasdaq 100 debut. The second change was more specific to SpaceX, being no disqualification for a company with a free float below 33% – something that’s arguably critical to provide liquidity required to maintain an orderly market.

It is estimated that around US$25 billion in passive capital (index funds and ETFs) that tracks the Nasdaq will be dispassionately forced into SpaceX – this equates to one third of the free float at IPO. In this instance, fundamentals just don’t matter – structural demand for SpaceX stock will exist, and if SpaceX achieves GAAP profitability by mid-2027, inclusion in S&P indices will introduce a fresh ~US$50b round of buying.

Most of the coverage treated the Nasdaq change as a logistics matter—when can ordinary investors buy in—rather than as the erosion of a standard that exists precisely to protect them. The question of whether a company should be in an index because it is profitable was quietly reframed as the question of how soon you can own it.

Where exuberance lives, value dies

Some fund managers capitulate and bow to the money momentum these stories perpetuate, some do not. The more intense the daily spotlight on mega IPOs, the longer the shadows are cast over thousands of small, mid and big cap stories that aren’t in the business of building trillion-dollar interplanetary tech boondoggles.

To its credit, the serious financial press has not ignored the warning signs. The bubble question is being asked – the ninety-times-revenue multiple, the US$4.9 billion loss, the dot-com echoes in a market whose cyclically adjusted earnings multiple sits at levels rarely seen outside that era.

But that scrutiny almost always arrives as a debate, a both-sides-have-a-point even-handedness, a question posed rather than a judgement made – often hedged and drowned beneath the louder coverage of records broken and labels rewritten.

A valuation that is never quite declared unreasonable, only endlessly debated, is one the market learns to live with. That, more than any single breathless headline, is how exuberance is normalised.

A bottom-up value manager may argue this provides fertile ground to go fishing for beautifully-boring, cash-generative companies, while awaiting some sort of global reckoning. History will tell us who was right and for how long they were wrong.

Where does it end?

Anything is possible, certain things are probable. Musk’s cult following clearly feels the merely possible is probable, and the ‘normalisation of exuberance’ is something the world has gotten used to in recent years.

But regardless, the thesis still stands – SpaceX is a company priced on narratives.

Scott Schuberg is Managing Director in Australia