Morningstar to Add Liquidity Screen for $75B SpaceX IPO, Sets $220 Fair Value for Atlassian
Morningstar will introduce an alternative liquidity screen for its CRSP Market Indexes to fast-track inclusion of SpaceX’s potential $75 billion IPO and future mega-unicorn listings, affecting benchmarks like Vanguard’s $607 billion Total Stock Market ETF. Morningstar’s $220 fair-value estimate for Atlassian coincided with a 5.17% rally after a 54% six-month decline.
1. Morningstar Index Enhancements
Morningstar plans to enhance its CRSP Market Indexes by introducing an alternative liquidity screen designed to measure free float for mega-unicorn IPOs such as SpaceX. This enhancement aims to accelerate the addition of companies with large IPOs — up to $75 billion in the case of SpaceX — by adjusting eligibility criteria that currently delay inclusion.
2. Implications for ETFs
The updated liquidity screen could lead to faster rebalancing of major passive products tied to CRSP benchmarks, notably Vanguard’s $607 billion Total Stock Market ETF. Quicker inclusion of large IPOs may shift portfolio weights and trading volumes, influencing index tracking and fund inflows.
3. Atlassian Fair-Value Estimate
In a separate analysis, Morningstar set a $220 fair-value estimate for Atlassian, based on projected revenue growth and AI integration into its product suite. This valuation stands in contrast to a stock decline of 54% over the past six months, suggesting a sizeable upside if market sentiment shifts.
4. Market Reaction to Atlassian
Atlassian shares rose 5.17% in response to investor optimism that the software sector is undervalued and has effectively incorporated AI capabilities. The rally reflects renewed confidence in enterprise software demand and Morningstar’s valuation framework.