Key facts
- Space stocks fell after SpaceX set its IPO price at $135 per share.
- SpaceX's IPO valuation was set at $1.75 trillion, below the $2 trillion some investors expected.
- Intuitive Machines fell 15.2%, Rocket Lab dropped 7%, and AST SpaceMobile lost nearly 9%.
- Many space stocks are still up significantly over the past six months, with some up over 400%.
- Several unprofitable space companies contributed to negative sentiment, alongside a Blue Origin rocket explosion.
- Traditional defense stocks like Boeing and Northrop Grumman performed better than pure-play space companies.
Space stocks experienced a significant selloff after SpaceX revealed its IPO pricing, leading investors to lock in gains from a recent rally. SpaceX set its IPO price at $135 per share, resulting in a valuation of approximately $1.75 trillion. This figure fell short of the $2 trillion some investors had anticipated, triggering profit-taking across the sector. Intuitive Machines led the decline, falling 15.2%, followed by Rocket Lab down around 7% and AST SpaceMobile down nearly 9%. Other space stocks like Merlin, Sidus Space, Redwire, and Satellogic also saw notable drops. Despite these declines, many space stocks have seen substantial gains over the past six months, with some increasing by over 400%. The sector faces profitability questions, as many of the hardest-hit companies, including Intuitive Machines, Rocket Lab, and Redwire, reported significant net losses. An explosion of Blue Origin's New Glenn rocket also negatively impacted investor confidence. In contrast, traditional defense stocks such as Boeing and Northrop Grumman showed more resilience, indicating a pullback from high-growth space names rather than the broader defense sector. Analysts expect money to rotate towards SpaceX, the dominant player, once its shares become publicly available. The space economy continues to grow, supported by defense spending and satellite deployments, but valuations had become stretched, and the IPO pricing served as a market reset.