SpaceX (SPCX), 'Halved' from its peak of $225... IPO effect ends in just 2 weeks

▲ SpaceX (SPCX)/AI Generated Image

SpaceX (SPCX) surged from $150 to $225 and then fell back to around $150 in less than two weeks after its initial public offering (IPO), with the scarcity of circulating shares and the burden of lock-up expiration emerging as key market variables behind the massive IPO frenzy.

According to Nasdaq on July 3 (local time), after SpaceX completed its IPO on June 12, its stock price jumped to $150 on the first trading day, then rose to $225 in a short period. However, in less than two weeks, the stock price returned to around $150. Nasdaq reported that the stock's volatility increased immediately after listing, driven by investment fervor surrounding the space industry and artificial intelligence (AI), coupled with the acquisition of Cursor, valued at $60 billion.

The starting point for the sharp fluctuations was the structure of circulating shares. On the day of the IPO, SpaceX offered only 4.24% of its total shares as publicly traded volume. With less than 5% of shares available for buying and selling in the market, a typical supply-demand imbalance occurred as buying interest surged, causing the stock price to rise sharply in the early stages of listing.

However, after the stock price reached around $225, investor sentiment quickly cooled. Nasdaq pointed to overvaluation concerns, worries about existing shareholder dilution due to stock financing for the Cursor acquisition, and the fading excitement that peaked on the IPO day as reasons for the stock's decline. The market began to reflect future stock supply expansion and valuation burdens in the price, rather than growth expectations.

The lock-up expiration schedule also became the next variable for the stock price. While the typical lock-up period for newly listed companies is about 180 days, SpaceX adopted a phased lock-up release method. After the first earnings announcement, if certain stock price conditions are met, an initial selling window opens, and then the circulating volume increases several times. CEO Elon Musk and major investors are subject to a 366-day lock-up, and stock sales will be possible from June 14, 2027.

Even after the stock price decline, SpaceX is trading at a market capitalization of around $2 trillion. This valuation is approximately 110 times its projected 2025 revenue of $18.6 billion. Nasdaq stated that the rapid decline starting from $225 is a warning sign showing how quickly SpaceX can lose value when investor sentiment changes. How quickly circulating shares increase over the next year remains a key risk for SpaceX's stock price.

[Key Article Summary]

-After its IPO on June 12, SpaceX surged from $150 to $225 but fell back to around $150 in less than two weeks.

-On the day of listing, only 4.24% of the total shares were available for public trading, and limited circulating shares were identified as the main reason for the initial surge.

-SpaceX has a market capitalization of $2 trillion, valued at approximately 110 times its 2025 revenue, leaving lock-up expiration and increased circulating volume as burdens on the stock price.

*Disclaimer: This article is for investment reference only, and we are not responsible for any investment losses based on it. The content should be interpreted for informational purposes only.*