The "overvalued" label has followed Space Exploration Technologies (SPCX -0.40%) around since before it went public. Despite that, the share price hasn't collapsed over the four-plus months since its June IPO. It closed at $145 on Oct. 22, not much lower than its first-day open of $150.

SpaceX's track record so far as a public company raises the question of whether its stock is actually too expensive.

Image source: The Motley Fool.

The numbers indicate that it is. SpaceX has a market cap of $2 trillion, making it one of the 10 largest publicly traded companies. It has the lowest revenue of that group and posted its first profit as a public company in Q3, with net income of $4.4 billion. The space company also trades at 61 times trailing sales. For perspective, Nvidia trades at 17 times trailing sales.

To be fair, SpaceX is richly valued because of its growth potential, and it's growing quickly. Revenue increased 161% year over year to $14.6 billion in Q3 2026. Its AI segment, now called Super Intelligence (SI), was a standout, with revenue increasing 830% year over year to $7.6 billion. SpaceX's financial results have helped bring its valuation down quite a bit -- it was trading at nearly 100 times trailing sales before it reported earnings on Oct. 20.

However, it still has a high valuation, which leaves it little room for error. It needs significant quarterly sales growth to justify the premium investors are paying. A bear market, especially one that leads to a slowdown in AI spending, could also be particularly problematic for SpaceX.

AI now accounts for over half of its revenue, and it's spending heavily on AI infrastructure. Its AI segment accounted for $16.4 billion of its $19.6 billion in Q3 capital expenditures.

SpaceX stock is undoubtedly expensive right now. I'm taking a wait-and-see approach with this company, but if you want to invest, consider starting small because of the risk and volatility.