Key facts
- Retail investors sold a net $4.5 million in SpaceX shares on August 7.
- This is the first time retail investors have been net sellers since SpaceX's IPO on June 12.
- The shift occurred as shares rebounded near the IPO price, suggesting profit-taking.
- SpaceX shares have fallen more than 22% below their IPO price after an initial surge.
- The company's first quarterly earnings report raised concerns about AI investment funding.
Retail investors, who had consistently bought shares of SpaceX since its June debut, turned into net sellers on August 7, marking the first instance of such activity. According to Vanda Research, individual traders sold a net $4.5 million in the rocket company's stock. This shift is attributed by analysts to a combination of profit-taking and position fatigue, rather than panic selling, especially as it occurred while shares were rebounding near their IPO price.
Previously, retail investors had bought the dip on August 5, when SpaceX shares fell 13.6% following the company's first quarterly earnings report. The report, while touting faster returns from AI spending, also raised concerns about the profitability of the Starlink business and its ability to fund costly AI investments. The stock's performance has seen a significant reversal, surging as much as 67% above its $135 IPO price in June before giving back all gains and falling over 22% below its debut price in August. Shares have closed below the IPO price daily since July 16.
Small investors have played a significant role in SpaceX's public market history, with at least 30% of shares available at its debut set aside for them. The company remains a trending ticker on retail-focused forums like Stocktwits and Reddit's r/WallStreetBets. Increased liquidity in the stock followed the expiry of initial lock-up restrictions last week, which more than doubled the number of shares available for public trading.