UBS says space tourism could be a $4 billion market by 2030. Here's how to play it

Published Wed, Jul 21 20213:36 PM EDTUpdated Wed, Jul 21 20215:00 PM EDT

As the space tourism sector heats up, one Wall Street firm thinks the industry could be worth billions of dollars within the next decade and suggests several stocks to get in on the action. A group of UBS analysts led by Jarrod Castle estimates space tourism could be a $4 billion market by 2030. They project the larger space economy could reach more than $900 billion by the same year. The firm's call comes after Blue Origin's founder Jeff Bezos blasted into space Tuesday aboard the company's first passenger spaceflight. He said the company is approaching $100 million in sales of future space tourist flights . Virgin Galactic founder and fellow billionaire Sir Richard Branson travelled to space nine days prior on a test flight with his company. "Space tourism remains a relatively small, but highly visible subset of the larger space ecosystem. However, the roll-out of space tourism and the resulting revenues are aiding the development of the space ecosystem and the democratisation of space," the UBS note said. At the moment, Virgin Galactic — which UBS calls the "poster child of space tourism" — remains the only publicly traded pure play on the trend. Private space tourism companies include Elon Musk's SpaceX, Blue Origin, Axiom Space and Space Adventures. However, these private space tourism ventures could list in the future and other companies are moving into the space. "There is a greater amount of private capital and investor interest in the space ecosystem with a number of space-related businesses and new forms of aviation companies coming or planning to come to the market, as well as private investment vehicles and private funding rounds," the UBS note said. "In our view, over time, there will be greater investable opportunities in the broad space ecosystem," the note said. In the meantime, UBS highlights several single-stock options to play the broad space theme, including aerospace companies Boeing and Lockheed Martin . The firm also noted the client base for space tourism has continued to grow as the number of millionaires and multimillionaires rose during the pandemic, according to CapGemini's most recent World Wealth Report. "There's room for 20 space companies to take people up there," Virgin Galactic's Branson told CNBC in July. "The more spaceships we can build, the more we can bring the price down and the more we'll be able to satisfy demand and that will happen over the years to come." —CNBC's Michael Bloom contributed reporting.

Billionaire businessman Jeff Bezos is launched with three crew members aboard a New Shepard rocket on the world's first unpiloted suborbital flight from Blue Origin's Launch Site 1 near Van Horn, Texas, July 20, 2021.

Joe Skipper | Reuters

As the space tourism sector heats up, one Wall Street firm thinks the industry could be worth billions of dollars within the next decade and suggests several stocks to get in on the action.