This industry’s profits will grow to the sky – literally – and beyond.
To “where no man has gone before.”
It was pioneered in the early 20th century by cranks and visionaries. The government brought it to reality, then nearly abandoned it except for communications and defense applications.
For the past few decades, it’s been the playground of billionaires like Sir Richard Branson, Jeff Bezos, and Elon Musk.
Now – finally – you can claim your own piece of the profits.
Branson’s company Virgin Galactic just recently launched its Initial Public Offering on the New York Stock Exchange – stock symbol SPCE.
But it’s only the modest beginning of the rest of humanity’s future.
Space Tourism
Virgin Galactic plans on taking people up on suborbital flights so that they can experience traveling in outer space.
Their commercial flights are scheduled to begin next year, and they already have a waiting list of over 600 people paying $250,000 for a place onboard.
Virgin Galactic CEO George Whitesides estimates that 2 million people could pay that. Over time, costs will go down, so up to 40 million people will want to go into space.
However, I believe the demand for a simple ride into space will eventually drop after enough people have “been there, done that.”
Fortunately, there’s a lot of wealth beyond suborbital space.
Wall Street estimates space will be a multi-trillion industry within 10-20 years. In 2017, Morgan Stanley released a report predicting space could be the economy’s most important industry by 2040.
That sounds far away, but it’s closer than Amazon’s IPO.
Therefore, it’s not (yet) a buy-now-next-week-will-be-too-late gold rush.
But it is a ground-floor-that-will-dwarf-everything-else long term investment.
Transporting People
Eventually, people flying into space will want to actually go someplace, not just tick off the most exotic item on their bucket list.
The aerospace companies Boeing and Lockheed Martin have been involved with space travel for decades, and they are still pioneering the industry. They are still the two most obvious companies that are going to profit as space travel becomes more common and profitable.
Eventually, we will see people visiting resorts on the Moon and custom-designed space stations a la the movie 2001: A SPACE ODYSSEY. There’s room for many stations to orbit Earth or the sun itself. They’ll start out practical and scientific, but eventually could form the basis for independent “countries.”
Elon Musk’s SpaceX is talking about flying to Mars.
However, SpaceX and Jeff Bezos’s Blue Origin are not yet planning IPOs.
The Moon and Asteroids are More Valuable Than Green Cheese
They’re made of many useful substances, including such precious metals as gold, silver, and platinum. That’s why asteroid mining has been a staple of science fiction for decades.
Shackleton Energy, Made in Space, Lunar Resources, ispace, Air Space and Beyond, Moon Express, Planetary Resources, and Space Development Nexus have set their sites on mining the moon or asteroids.
The Real Wealth will Come from Zero-Grav, Vacuum Manufacturing
Assuming billionaires such as Bezos, Musk, and Branson do their homework, they must have all read the 1979 book by G. Harry Stine, The Third Industrial Revolution. In it, Stine details how the greatest wealth from space will come from enhanced industry.
Not off-shore, but off-planet.
In space, there’s plenty of energy from the sun. Extremes of both heat and cold are easily available.
In space, the near absolute vacuum allows things to form without impurities. The free fall microgravity allows substances to expand without getting contaminated by contact with walls. Manufacturers will produce previously unknown alloys and materials for miniaturized electronic devices, computers, and much more.
One current example is ZBLAN. That’s a special type of fiber optic cable. When manufactured in microgravity, it won’t develop the tiny crystals that cause loss of signal — the result: a cable orders of magnitude faster and most efficient at transmitting information.
The company Made in Space is testing this on the International Space Station.
Stine predicts all industry will eventually go off-planet, allowing Earth’s environment to flourish again without pollution.
Besides Made in Space, Shackleton Energy is planning to exploit the capabilities of off-Earth manufacturing.
The Pick and Shovel Makers
Many companies are making money from space by providing the rockets, satellites, landers, rovers, orbiters, space stations, and components and equipment needed.
Closely Related Industries
Advances in space exploration and economic development will depend on robotics, Artificial Intelligence, and 3-D printing.
Investing in the Traditional Space Companies
Besides Branson’s Virgin Galactic, you can now invest in the publicly listed companies already profiting from satellites, communications, and imaging. Also, defense and space companies will remain closely linked for the near and mid-term future.
Boeing (BA)
DISH Network (DISH)
ViaSat (VSAT)
Maxar Technologies (MAXR)
Garmin (GRMN)
Aerojet Rocketdyne (AJRD)
Lockheed Martin (LMT)
Northrop Grumman (NOC)
Of the above, Aerojet Rocketdyne, DISH Network, and Maxar Technologies are “pure” plays in space. That is, that’s their business. Space-related products are just a fraction of the larger companies.
And, of course, space tourism is Virgin Galactic (SPCE)’s entire business.
I’m an old science fiction fan who grew up reading Robert Heinlein and Isaac Asimov. I’m certain humanity is headed for outer space unless civilization is first destroyed by a worldwide catastrophe – which would also make the rest of your financial investments worthless.
Therefore, the stock market is going to the moon – sooner or later.
It’s way too early to risk your entire savings on space, but it is an inevitable part of the future.
So, invest a comfortable amount, then prepare for lift-off.
