In this article, we will look at the 10 Best Stocks to Buy Before SpaceX IPO.
For years, SpaceX has been building an infrastructure that has redefined rocket launches, a global fleet of satellites via Starlink, and set up the U.S. government to potentially build the space force of the future. Amid all these incredible achievements, one thing hasn’t happened: access to company ownership via public markets. This is about to change.
SpaceX will make its IPO prospectus public by the end of May, with an IPO roadshow expected to begin in early June. The process culminating in the public trading of SpaceX stock is likely going to generate unprecedented retail investor interest. This will bring the space theme to the fore, and along with it, every other industry that is set to benefit from the success of SpaceX.
In a note to investors on April 12, Morgan Stanley analyst Adam Jonas wrote:
Space is back in a big way… [The SpaceX IPO represents] a combination of scientific advancements, geopolitics, and economics that have reignited investor interest in the space industry. It is a cross-sector ecosystem that will underpin the industry’s growth.
The ecosystem is the keyword here. Once the public is done with the IPO, attention will move to the ‘next SpaceX’ or its ‘competitors’. A higher valuation for SpaceX could well result in a re-rating for its competitors or companies involved in its supply chain.
To benefit from this, we decided to create a list of companies that will benefit from the event and are therefore the best stocks to buy before the SpaceX IPO.
Pixabay/Public Domain
Our Methodology
To come up with a list of companies that could be the best stocks to buy before the SpaceX IPO, we shortlisted companies in the same industry that are contributing to making space ambitions possible. We also added companies that are considered integral to the supply chain of firms like SpaceX, such as mining companies that provide the critical materials and gases that make rocket launches possible. We ensured that these companies are popular among US hedge funds and have reported recent newsworthy events. In the end, we ranked them in ascending order of the number of hedge funds holding them in their portfolios.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 498.7% since May 2014, beating its benchmark by 303 percentage points (see more details here).
Note: All share price data in the article is as per market close on April 23.
10. Teledyne Technologies Inc (NYSE:TDY)
Number of Hedge Fund Holders: 60
Teledyne Technologies Inc. (NYSE:TDY) is likely to be a beneficiary of the increasing focus on space travel after SpaceX’s IPO. The reason for this is the company’s strong position in space-grade electronics and instrumentation, as well as high-performance cameras critical in space missions and defense applications. The company just announced its Q1 2026 earnings and posted record quarterly sales of $1.56 billion, growing at a rate of 7.6% YoY. The company’s cash from operations was $234 million, while free cash flow stood at $204.3 million.
Going forward, management expects GAAP EPS of $4.825 at the midpoint in Q2. The earnings estimate for the full year is now set to $20.26 per share at the midpoint. Management expects sales to pick up in the second half of the year. The company received significant tax benefits in the first quarter, which are not expected to be there in the second. The company is receiving government support to increase capacity as demand for drones and counter-drones rises.
Teledyne Technologies Inc. (NYSE:TDY) provides aerospace electronics and instrumentation, digital imaging, and engineered systems that enable industrial growth. The company was founded in 1960 and is headquartered in Thousand Oaks, California.
9. ATI Inc. (NYSE:ATI)
Number of Hedge Fund Holders: 62
On April 10, financial services firm Susquehanna, reaffirming a positive rating on the ATI Inc. (NYSE:ATI) shares, raised its price target from $155 to $185. The firm’s upward price target revision suggests an additional 20.1% upside from the current levels. Analysts at Susquehanna believe there is a need to expand the Defense Industrial Base capacity due to the Middle East conflict. They are convinced that due to the current situation in the region, the Defence industry will grow over the next three to five years. After reviewing the revenue expectations for the first quarter, the firm updated its model for the Aerospace and Defense sector.
Similarly, on April 09, KeyBanc analyst Samuel McKinney raised the firm’s price target on ATI Inc. (NYSE:ATI) from $140 to $167 while maintaining an Overweight rating. After conducting a private survey, the firm expects higher future revenue due to increased activity in OEM. To keep up with high demand, suppliers are increasing inventory to prevent stock shortages. As already mentioned, there is significant growth potential for the defense industry due to the conflict in Iran, which may lead to higher oil prices. While geopolitical crises define a major part of ATI’s bull thesis, it also has a critical role to play in rocket launches and space systems thanks to its expertise in high-performance metals for extreme environments.
ATI Inc. (NYSE:ATI) operates as a seller and producer of specialty materials and complex components globally. The company operates through the Advanced Alloys & Solutions and High Performance Materials & Components segments. It was incorporated in 1996 and is based in Dallas, Texas.
8. Parker-Hannifin Corporation (NYSE:PH)
Number of Hedge Fund Holders: 64
On April 13, Citi raised its target price on Parker-Hannifin Corporation (NYSE:PH) shares from $1,092 to $1,137 while maintaining a Buy rating. The update came after the firm revised its expectations for the first quarter. Industry trends are improving steadily, which can result in increased revenue in Q1 of the fiscal year, according to Citi.
Similarly, on April 10, Stifel raised PH’s target price to $1,000 from $965. The firm surveyed 37 different local Park-Hannifin distributors, which generate an estimated 11% of Parker’s Diversified Industrial North America earnings. The analysts were satisfied with the responses and maintained the buy rating on Parker-Hannifin Corporation (NYSE:PH) shares.
The stock is covered by 29 analysts on Wall Street, as per CNN’s compilation of analyst ratings. According to these ratings, the median price target of $1,090 reflects 10.9% upside in the stock. The highest price target on Wall Street is currently $1,168, which is close to Citi’s price target of $1,137.
Parker-Hannifin’s motion and control systems, fuel systems, fluid connectors and valves, and thermal management expertise will become increasingly relevant as rocket launches become more common. Post SpaceX IPO, this strength could help drive a potential re-rating of the stock through increased investor interest.
Parker-Hannifin Corporation (NYSE:PH) operates as a seller and manufacturer of motion and control technologies and systems across a wide range of markets. These markets include in-plant and industrial equipment, energy, aerospace and defense, off-highway, HVAC and refrigeration, and transportation.
7. Woodward, Inc. (NASDAQ:WWD)
Number of Hedge Fund Holders: 69
On April 17, Ken Herbert, an analyst at RBC Capital, set a target price of $450 for Woodward, Inc. (NASDAQ:WWD). His price target suggests an additional upside of 21.6% from here on. Woodward is one of the top suppliers of control solutions for aerospace, defense, and industrial markets. RBC believes earnings will increase in the future due to an increased level of maintenance, repair, and overhaul activity. The main reason for the increase in earnings is the servicing and supply of aviation propulsion and geared turbofan engines.
An agreement between Ontic Engineering and Manufacturing and Woodward was reached on April 15, under which Woodward will sell the pilot control product line and services to Ontic Engineering. This includes pilot controls for commercial and defense applications such as throttle quadrant assemblies, passive side sticks, and rudder pedals, which are assembled at Woodward’s Illinois plant. Moreover, Woodward will be the sole supplier of certain components under a long-term supply agreement. The deal now just needs regulatory approval.
Woodward, Inc. (NASDAQ:WWD) operates in the aerospace industry, manufacturing and servicing control solutions for its global clientele. It operates in two segments, namely Aerospace and Industrial. The company has been operating since 1870 and is headquartered in Fort Collins, Colorado.
6. Howmet Aerospace Inc. (NYSE:HWM)
Number of Hedge Fund Holders: 71
On April 10, Charles Minervino, an analyst at Susquehanna, while maintaining a Buy rating, set a target price of $300 on Howmet Aerospace Inc. (NYSE:HWM) stock. The firm’s price target reflects a further 17% upside from the current levels. This upside is consistent with the median Wall Street analysts’ upside of 16.24% based on estimates of 27 analysts covering the stock.
Earlier, on April 6, Howmet Aerospace Inc. (NYSE:HWM) completed the acquisition of Consolidated Aerospace Manufacturing, LLC from Stanley Black & Decker. The deal was valued at about $1.8 billion in cash. With this acquisition, the company has expanded its portfolio of aerospace components, as well as strengthened its position in the aerospace supply chain. The acquisition brings in Consolidated Aerospace Manufacturing’s specialized expertise and established customer relationships. This further strengthens Howmet Aerospace’s overall capabilities in the industry.
As a supplier of aerospace components, including engine parts and high-performance metal parts, HWM’s business could come to the fore as a driver of the space revolution of the future. The company operates as an advanced engineered solutions provider and offers its solutions to the aerospace and transportation industries. It operates in the Engineered Structures, Engine Products, Forged Wheels, and Fastening Systems segments and is based in Pittsburgh, Pennsylvania.
While we acknowledge the potential of HWM to grow, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an AI stock that is more promising than HWM and that has 100x upside potential, check out our report about the cheapest AI stock.
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