SpaceX stock fell below $135. That’s the price chosen by CEO Elon Musk and the company ahead of its blockbuster June 12 IPO that raised nearly $86 billion.
After falling below that price on Wednesday afternoon and dropping below $133 per share, the stock rallied back up to $135 and rose above it at times.
Wednesday’s decline followed a month of steady declines since the company went public. SpaceX’s stock price initially rose to more than $200 in the days after it went public, at one point giving it a valuation comparable to tech giants like Amazon and Microsoft. Since reaching that high, the company’s stock has essentially lost value every week.
Part of the volatility is due to the fact that only 4% of the company’s total shares trade on the Nasdaq. This small “float,” as it is known, combined with the constant amount of attention on the company, caused wild swings during the first month of trading.
The market also appears to be cooling down on Chief Executive Elon Musk’s grand vision for the company, part of a broader deflation in tech stocks last month. Not only has SpaceX’s stock price fallen, but the bonds it sold after its IPO have also taken a hit.
A prolonged downturn in SpaceX’s stock could have broader implications, as it shows how investors view the (literally) out-of-this-world promises Musk has made about what the company can accomplish. SpaceX’s IPO also set the stage for other big tech companies to go public, including Anthropic and OpenAI. Both companies secretly filed for an IPO. Neither company has set a listing date, but all eyes will be on SpaceX stock to gauge how successful these IPOs will be.
SpaceX is about to face another early test of its stock’s durability. On Thursday, the company will test launch its Starship rocket for the first time since its IPO. Because Starship is still in development, it is likely to fail as a result of SpaceX’s “fly, fail, fix” approach.
This will be Starship’s first flight since a booster failure occurred in May. And once again, the company did not plan to retrieve Starship’s boosters or upper stage on this flight, instead choosing to have it simulate a landing in the Gulf of Mexico. This means that both parts of the entire Starship rocket system will end up exploding no matter what, even if nothing goes wrong during the flight plan.
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