Key facts
- SpaceX shares have fallen 67% from their post-IPO closing high, erasing $1 trillion in market value.
- The company's shares peaked at $2.64 trillion on the third day of trading and have been on a gradual decline since.
- Short sellers have gained an estimated $5 billion in paper gains since the IPO.
- Approximately 30% of SpaceX's total float has been sold short.
- 20% of the company's early-release-eligible shares will become available for sale after the second-quarter earnings report on August 17.
- Despite recent selling, Wall Street analysts maintain a largely bullish stance with 30 buy ratings, 6 holds, and 1 sell.
SpaceX shares have experienced a significant decline since their initial public offering, with market value erasing $1 trillion from its post-IPO closing high. The stock peaked at $2.64 trillion on its third trading day before entering a multiweek decline, ultimately trading below its $135 offer price. This downturn has validated the concerns of skeptics who criticized the company's initial valuation as too high and questioned the long-term viability of its ambitious ideas.
Recent events, including an aborted rocket launch due to engine failure, have further pressured the stock. Data from S3 Partners indicates that short-sellers have gained approximately $5 billion in paper gains, with short interest increasing significantly in the past month. A substantial number of shares, representing 20% of the early-release-eligible float, are set to become available for sale after SpaceX's second-quarter earnings report on August 17, potentially impacting the share price further.
Despite the recent volatility, Wall Street analysts remain largely optimistic. According to Bloomberg data, there were 30 buy ratings, 6 holds, and only one sell rating for SpaceX shares at the end of last week. Major firms like UBS, Bernstein, and Raymond James reaffirmed their buy ratings amid the selling pressure. The consensus 12-month price target stands at $235.34, suggesting significant upside potential from Friday's closing price. Analysts believe that, similar to Meta's early trading performance, SpaceX may experience a rough patch before potentially reaching new highs.