SpaceX shares climbed almost 5% on Tuesday, briefly pushing the rocket company's market value past Microsoft and above several other major technology companies. The rally came just days after the company's blockbuster IPO on Friday, and it renewed questions about whether a valuation of roughly $2.5 trillion can be justified by the company's financials.
CNBC's Jim Cramer addressed that question directly on his program. He argued that conventional valuation methods do not capture what investors are actually purchasing when they buy SpaceX stock.
"The stock is called SpaceX, but it might as well be called Elon Musk," Cramer said on Mad Money.
Cramer acknowledged the company is not currently profitable and may not be for years. "There is no way this company, which could see losses for many years, deserves such a high valuation on its own. It only gets there because it's run by Musk," he said.
Musk has projected that SpaceX could reach $1 trillion in annual revenue by 2030. Cramer said the specific forecast matters less than the broader case investors are making, which is that Musk has a demonstrated track record of building businesses that define new categories and generate commercial opportunities over time.
"When you buy SpaceX here, you're really buying Elon Musk's brain," Cramer said. "I think the cult of Musk is for real."
Cramer pointed to a range of SpaceX operations and growth initiatives that investors appear to be pricing in, including the Starlink satellite internet network, reusable rocket operations, and long-term data center ambitions. He also noted that SpaceX announced Tuesday it will acquire AI coding startup Cursor for $60 billion in stock, a move that deepens the company's push into artificial intelligence and software development tools.
Cramer drew a comparison to how earlier generations of investors approached Berkshire Hathaway under Warren Buffett, viewing it less as a collection of assets and more as a vehicle tied to a particular leader's judgment and deal-making ability.
He acknowledged that skeptics have been raising concerns about the stock's price since the IPO, but said that skepticism has not slowed the buying. "While you're sitting here trying to justify SpaceX's valuation, the buyers are relentlessly pushing it up, and I bet they keep going," he said.
SpaceX's xAI division, which developed the Grok AI model and chatbot, was previously a separate company before merging with SpaceX in February.
