After shooting the lights out in its first few days as a listed company, SpaceX (NASDAQ: SPCX) shares have now fallen below their IPO price of $150.
I wouldn’t be surprised if this sort of volatility stuck around. For all the excitement that Elon Musk’s business inspires, one can’t ignore the fact that it also fails to deliver the very thing most investors tend to cherish the most: profit.
I prefer to back companies with proven track records on this front.
Fortunately, one doesn’t need to look all that hard to find some in the UK market.
Less hype, better results
An example is FTSE 100 member Computacenter (LSE: CCC).
Back in May, the technology services provider announced that higher corporate spending on IT, particularly in North America, had led to strong performance in the first quarter of 2026. This was followed on 9 July by a statement that first-half adjusted pre-tax profit would be about double that of the £81.5m achieved over the same six months in 2025.
In addition, the company now expects its full-year profit to come in comfortably ahead of market expectations.
Such talk was always likely to go down well with the market. However, Computacenter’s value has been motoring upwards for a while, no doubt helped by its involvement in the AI boom. Anyone investing one year ago would have doubled their money, in addition to receiving dividends.
If the firm somehow manages to eclipse its own projections in 2026, there could be even more gains ahead.
Already priced in?
Of course, there’s always a chance that earnings suffer an unexpected blow and/or investor expectations overtake reality. Supply chains could get interrupted or its market could become even more competitive.
All this needs to be kept in mind given Computacenter’s valuation. The forecast price-to-earnings (P/E) ratio now stands at 22. That’s not excessive but it does suggest that the price is fairly up-to-date with events. It could also mean that the £4.7bn cap could suffer more than most in the event of a sudden downturn in the general market. Such are the risks that come with owning growth stocks.
Even in the absence of a crash or correction, operating margins are extremely low. Put another way, a slight rise in costs can have a meaningful impact on performance. If this were to persist, one suspects the share price will suffer.
Will I ever buy SpaceX shares?
Despite these concerns, I’m far more interested in Computacenter than SpaceX as a potential investment.
It’s not that I can’t find anything of value in the latter. Its satellite division, Starlink, is certainly proving its salt.
Even so, the absurd valuation being slapped on the company as a whole, supported by speculative claims about commercial asteroid mining and space tourism, leads me to think there are better opportunities elsewhere.
I grudgingly accept that I will inevitably own a slice of the company as and when the index funds that I hold are required to buy in.
But buy the shares directly? I’d rather keep my feet on the ground.
Should you invest £5,000 in Computacenter Plc right now?
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Paul Summers has no position in any of the shares mentioned.
