ICYMI – SpaceX shares dip below IPO price for first time before paring losses
The pullback highlights how quickly investor enthusiasm can fade even for the most hyped listings, with SpaceX's valuation now well off last month's peak above tech giants Microsoft and Amazon. Analysts point to profit-taking, unwinding of overly bullish positioning, and broader unease over debt-funded AI spending amid the risk of further Federal Reserve rate hikes. With the green shoe option already exhausted, underwriters have little room left to stabilize the stock. Attention now turns to the company's first post-listing earnings in early August and the subsequent lock-up expiry, both seen as potential near-term catalysts for further volatility.
--- SpaceX's blistering post-IPO rally continues to unwind, with shares briefly dipping below their offer price a month after the biggest listing ever.
Summary:
- SpaceX shares fell as low as $132.28 on Wednesday, below the $135 IPO price, before closing at $135.27, down 0.6% on the day
- The stock has dropped roughly 13% since joining the Nasdaq 100 and remains well below last month's peak valuation above $2.6 trillion, compared with around $1.78 trillion on Wednesday
- Analysts cite profit-taking, unwinding of bullish positioning, and concern over SpaceX's debt-funded AI spending, including a recent $25 billion bond sale, as key pressures on the stock
- Wall Street remains largely bullish longer term, with Morgan Stanley setting a $300 price target and JPMorgan $225 by the end of 2027, though Morningstar values the stock at just $63
- Investor focus is shifting to SpaceX's first post-listing earnings, expected in early August, followed by a lock-up expiry that could add further selling pressure
- The company's next Starship test flight, seen as critical to its AI and satellite ambitions, is also drawing close investor attention
SpaceX shares fell below their initial public offering price for the first time on Wednesday before closing just above that level, a sign that Wall Street's enthusiasm for the biggest listing in history is fading a little over a month after the company's debut. According to Reuters, the stock slid as low as $132.28 during the session, below the $135 IPO price, before recovering to close at $135.27, down 0.6% on the day.
The retreat leaves SpaceX well off last month's high, when the stock briefly pushed the company's valuation above $2.6 trillion, eclipsing longer-established tech giants Microsoft and Amazon despite SpaceX's weaker financial track record. By Wednesday afternoon, that valuation had fallen to around $1.78 trillion. The shares have dropped some 13 percent since being added to the Nasdaq 100 index, with that inclusion failing to reverse the slide.
Analysts pointed to a mix of profit-taking, the unwinding of extremely bullish positioning built up around the IPO, and growing investor unease over SpaceX's debt-funded expansion into artificial intelligence infrastructure. The company raised $25 billion in the bond market last month, joining other large tech firms funding costly buildouts whose eventual returns remain contested on Wall Street. That concern has been compounded by the prospect of further Federal Reserve interest rate hikes, which could pressure already stretched technology valuations.
With SpaceX's green shoe option already fully exercised, underwriters have little remaining capacity to support the stock through further weakness. Some market watchers noted the drop is not unusual for a newly listed company, but said SpaceX's scale and prominence make the move more closely scrutinized, particularly given the company posted a $4.9 billion loss last year and many of its longer-term ambitions remain unproven.
Wall Street's longer-term view of the stock remains largely optimistic. Morgan Stanley, one of the lead underwriters on the IPO, has set a 12-month price target of $300, while JPMorgan projects the shares reaching $225 by the end of 2027. Morningstar has taken a far more cautious view, valuing the stock at just $63.
Investor attention is now turning to SpaceX's first earnings report since going public, expected in the first week of August, after which the initial phase of the IPO lock-up period will expire, potentially allowing employees and early shareholders to begin selling their holdings. Markets are also watching closely for the next test flight of the company's Starship rocket, a vehicle central to SpaceX's ambitions in artificial intelligence infrastructure and satellite communications, including plans for orbital data centers and lunar missions.
This article was written by Eamonn Sheridan at investinglive.com.提供 MainLink：Investinglive RSS Breaking News Feed
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