Billionaire Elon Musk could receive one of the largest compensation packages ever disclosed. Indeed, aerospace firm SpaceX revealed in its S-1 filing that Musk may be awarded more than 1.3 billion shares if the company hits major valuation and operational goals. As a result, the awards could be worth about $760 billion. However, the milestones are extremely ambitious and include establishing a permanent human colony on Mars with at least one million people.
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Still, when combined with Musk’s separate Tesla (TSLA) pay package, he now has roughly $1.8 trillion of potential equity awards tied to future performance.
Breaking Down Musk’s Pay Package
Notably, Musk has two pay packages from SpaceX. The larger package was approved in January and includes up to 1 billion performance-based restricted Class B shares split into 15 equal parts. To receive the full award, SpaceX would need to reach a $7.5 trillion market value, and none of those shares vest unless the company establishes a Mars colony. The smaller package came from Musk’s xAI deal, which was restructured after xAI merged with SpaceX in February.
That award includes 302.1 million shares split into 12 parts, with market cap targets ranging from $1.065 trillion to $6.565 trillion, and requires SpaceX to build non-Earth data centers capable of delivering 100 terawatts of compute per year.
Nonetheless, the filing raises some corporate governance questions as SpaceX moves toward what could be the largest IPO ever. Indeed, Musk already controls a majority of SpaceX’s voting power, which allows him to elect the board, and the company plans to use exemptions that avoid some independent committee requirements. As a result, public shareholders may have limited recourse if the company makes strategic mistakes because Musk controls about 85% of the voting power.
What Is the Prediction for TSLA Stock?
When it comes to Elon Musk’s companies, most of them are privately held. As a result, until SpaceX goes public, retail investors can invest in his most popular company, Tesla. Turning to Wall Street, analysts have a Hold consensus rating on TSLA stock based on 12 Buys, 12 Holds, and five Sells assigned in the past three months, as indicated by the graphic below. Furthermore, the average TSLA price target of $403.86 per share implies 5.5% downside risk.
