SpaceX stock hit a new low Monday before recovering for a nice gain. Still, investors wonder whenthe selling pressurewill end.
Shares of Elon Musk’s rocket and AI company traded as low as $104.83 before closing at $114.53, up 5.7% on the day. The S&P 500 and Dow Jones Industrial Average were up about 1.5% and 1.3%, respectively.
A strong market at the start of a new month probably helped, although not much has boosted the shares these days.
Coming into Monday trading, SpaceX stock was down about 20% from its $135 IPO price, down about 46% from a record closing high of $201.80, and down 52% from its all-time intraday high of $225.64. The stock’s intraday high valued SpaceX at roughly $3 trillion. The latest price values the company at about $1.4 trillion.
Another thing that probably helped was positioning ahead of the company’s inaugural earnings report on Tuesday.
SpaceX has become a popular short, with traders believing shares would be weak while investors waited for insider and early investor holdings to be unlocked. Why buy any stock ahead of a wave of selling?
The traders were right. Through Friday trading, shares had dropped for three consecutive days and 17 of the 22 trading days in July. Shares didn’t have back-to-back gains last month. Shares lost 34% in July and ended the month on a four-week losing streak.
Now, it seems traders don’t want to take the risk of a post-earnings pop.
Aside from the IPO share lockup, valuation has weighed on investor sentiment. Current prices still value the stock at about 35 times estimated 2026 sales. That’s pricey. Alphabet stock is valued at about 9 times sales. SpaceX, of course, is expected to grow faster than Alphabet.
As for the lockup, about 912 million shares will be freed up later this week, a couple of days after the earnings report.
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