Banking giant Wells Fargo says the public stock debut of Elon Musk’s SpaceX could lift one sector of the market this year.
In a new one interview Joining CNBC, Mark Smith, senior vice president and portfolio manager at Wells Fargo Advisors, says the spacecraft company’s initial public offering (IPO) will help propel the communications sector in 2026 as a result of company mergers.
“You’re going to see communications services, with all the consolidation you’ve seen this year, you’re going to really see that sector shine…
The theme is again what I was just talking about, which is consolidation. I’ve never seen it before in my career where you’ve seen so much consolidation in the last year, with companies merging. And I think this will be great for profit margins.
I also think there will be a lot of interesting IPOs. I think SpaceX, to name just one, will really propel that sector forward and be a catalyst to take it even further next year.”
According to Smith, SpaceX will help communications more than technology because its satellites are revolutionizing the communications industry.
“If you look at the satellites and stuff and what I’m talking about, I think over the next decade you’re really going to see the change in the way we traditionally look at communications services.”
Although SpaceX has not yet set an official date for its IPO, it is scheduled to launch sometime in mid-to-late 2026, with an estimated valuation of more than $1 trillion.
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Featured image: Shutterstock/Space Creator/Sensvector