Cathie Wood Calls 85x Sales "Deep Value" at SpaceX
Cathie Wood says SpaceX is a deep value play at 85 times sales. Scott Galloway reads the same multiple as evidence of excess. Both cases rest on one unresolved question.
Cathie Wood has described SpaceX as a deep value play despite a price-to-sales ratio of 85, a reading Scott Galloway uses to argue the opposite case about the same private company.
Two well-known market voices are looking at the same number and reaching opposite conclusions. Cathie Wood, whose firm holds a private-market stake in SpaceX, has described the rocket and satellite company as a deep value play even though it carries a price-to-sales ratio of 85. Scott Galloway, working from the same figure, reads it as a warning rather than an invitation.
The disagreement, reported by 24/7 Wall St, is unusual in one respect: there is no argument about the input. Both sides accept the 85 multiple. What they dispute is whether today's revenue base is the right denominator for a business whose backers expect its addressable market to be redrawn.
What an 85 multiple actually asks of a business
Price-to-sales compares a company's valuation to its annual revenue. Unlike a price-to-earnings ratio, it says nothing about profitability, cost structure or cash conversion. It is a crude instrument, which is exactly why it gets used for companies that are growing fast and not yet optimized for reported earnings.
At 85 times sales, every dollar of annual revenue is being assigned $85 of value. For illustration only, that means revenue would have to roughly double for the multiple to compress to about 42.5 times sales with the valuation unchanged — and would have to rise by far more than that before the number looked ordinary against the broad market. That is the arithmetic burden Wood's "deep value" framing has to carry: it is a claim about the size of the future revenue line, not about the current one.
This is not a new posture for Wood. Her public research has consistently argued that conventional valuation screens misprice companies positioned at the front of a technology shift, because the screens anchor on trailing financials that the shift is about to render irrelevant. Applied to SpaceX, the argument is that launch, satellite broadband and any adjacent businesses are early in their revenue curves, and that today's sales figure understates the base a buyer is really acquiring.
Galloway's objection is about the denominator, not the math
Galloway's counter-case, on the same numbers, is the more conventional one: a multiple that high requires a sequence of things to go right, and the market has already paid for most of them. In private markets, that risk is harder to hedge and harder to exit. There is no daily quote to mark against, no options chain, and no guarantee of a liquidity event on an investor's preferred timetable.
The specific tension here is that SpaceX is unlisted. Retail investors cannot express a view by buying or shorting shares. Exposure runs through vehicles that hold private positions — including ARK's venture fund structure — or through secondary transactions available to a narrow set of holders. That changes the nature of the debate. When a listed stock trades at a contested multiple, the market resolves the argument continuously. When a private company does, the resolution comes in discrete jumps: a new funding round, a tender offer, a revised mark on a fund's books.
Why the marking question matters more than the label
For anyone holding SpaceX indirectly, the practical issue is not whether 85 times sales is cheap or expensive in the abstract. It is how the vehicle they own carries the position and how often that carrying value is revisited. Private holdings are typically valued by reference to the most recent financing round or a comparable-company analysis, and both inputs move with sentiment in the listed space and satellite sector.
That creates an asymmetry worth understanding. If listed comparables in launch services, satellite communications and defense electronics re-rate downward, the read-through to private marks eventually follows, even if nothing about the underlying company has changed. The reverse is also true, which is part of why a high multiple can persist for years without being tested.
- A price-to-sales ratio ignores costs entirely; it can be low for a business losing money and high for one generating strong cash flow.
- Private-market valuations update on events, not on days, so drawdowns arrive late and in larger steps.
- Investors reaching SpaceX through a fund are also buying that fund's valuation policy, fee structure and redemption terms.
The wider tape is not helping the high-multiple case
The argument is playing out against a soft session for risk assets. As of the last trade at 19:27 GMT on Wednesday, the SPDR S&P 500 ETF was at $749.79, down 1.00% on the day from a prior close of $757.39, with a day range of $749.67 to $761.67 — meaning it was sitting at the bottom of its intraday band. The Invesco QQQ Trust, which tracks the Nasdaq 100 and is the closest large-cap proxy for high-growth technology, was at $700.25, off 0.61% from $704.54, also near its session low of $700.08. The SPDR Dow Jones Industrial Average ETF was the weakest of the three at $512.47, down 1.68% from $521.23.
Nothing in those quotes says anything directly about SpaceX. But the conditions matter for the argument. Multiples of the kind Wood is defending expand when capital is cheap and patient, and compress when it is neither. A tape where all three major benchmark proxies are closing in on their daily lows is not the environment in which "deep value at 85 times sales" gets the benefit of the doubt from the marginal buyer.
What would settle it
Neither side can win this on the current disclosure. SpaceX does not publish quarterly financials, so the revenue growth rate that Wood's case depends on is not publicly verifiable, and the margin structure that would justify or undermine the multiple is not either. Both positions are, in effect, forecasts wearing the clothes of analysis.
Three things would move the debate onto firmer ground. The first is a new primary funding round, which would establish a fresh valuation and, by implication, a fresh multiple. The second is any disclosure of revenue scale and mix — how much comes from launch contracts versus recurring subscription-style satellite broadband, since recurring revenue commands a higher multiple than project work. The third is the direction of listed comparables, which set the reference points that private marks lean on.
Until at least one of those arrives, the sensible reading is that "deep value" and "overvalued" are both descriptions of the same unresolved question: how large the revenue base becomes, and how quickly. Investors who cannot answer that with conviction should treat the multiple as what it is — a placeholder for an assumption, not a measurement.
Key facts
- SpaceX price-to-sales: 85 times sales, as cited by both sides of the debate
- Cathie Wood's position: Describes SpaceX as a deep value play at that multiple
- Opposing view: Scott Galloway reaches the opposite conclusion from the same figure
- Market backdrop (19:27 GMT, Sep 16, 2026): SPY $749.79 (-1.00%), QQQ $700.25 (-0.61%), DIA $512.47 (-1.68%)
Frequently asked questions
What does a price-to-sales ratio of 85 mean?
It means the company's valuation equals 85 times its annual revenue, so each dollar of sales is assigned $85 of value. The ratio ignores costs and profitability entirely, which is why it is often used for fast-growing businesses that have not yet optimized for reported earnings. A high reading implies large expected revenue growth.
Can retail investors buy SpaceX shares directly?
No. SpaceX is a private company and is not listed on a public exchange, so there is no ticker to buy or short. Exposure is typically obtained indirectly through funds that hold private positions, including venture-style vehicles, or through secondary transactions that are generally limited to existing holders and qualified buyers.
Why do Cathie Wood and Scott Galloway disagree if they use the same number?
They accept the same 85 times sales multiple but dispute what the revenue figure represents. Wood treats today's sales as an early-stage base that will expand substantially, making the multiple look cheap in hindsight. Galloway treats it as the relevant denominator now, meaning the valuation already prices in outcomes that may not arrive.
How are private company stakes valued inside a fund?
Private holdings are usually marked by reference to the most recent primary funding round or by comparison with similar listed companies. Because those inputs change only occasionally, carrying values update in discrete steps rather than continuously, so declines can appear later and in larger increments than they would in a publicly traded stock.
What would resolve the valuation argument?
A new primary funding round would establish a fresh valuation and multiple. Disclosure of revenue scale and mix would show how much is recurring satellite broadband income versus one-off launch contracts, which carry different multiples. Movement in listed space and satellite comparables would also shift the reference points private marks rely on.
What were the major US benchmarks doing when the debate surfaced?
As of the last trade at 19:27 GMT on September 16, 2026, the S&P 500 proxy SPY was $749.79, down 1.00%, near its session low of $749.67. The Nasdaq 100 proxy QQQ was $700.25, down 0.61%, and the Dow proxy DIA was $512.47, down 1.68% — a broadly weak tape for high-multiple growth assets.
Sources
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