SpaceX Stock Faces Significant Pullback Post-IPO
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 58 minutes ago
0mins
Source: Fool
- Stock Pullback: SpaceX's share price fell 20.2% in its second week of trading, contrasting with the S&P 500's 2% decline and Nasdaq's 4.6% drop, indicating market concerns over its valuation.
- IPO Success: While SpaceX's IPO is hailed as the largest in history, raising $85.7 billion and initially trading above $135, the stock is now down 24% from its peak, reflecting a waning market enthusiasm.
- Market Sentiment Impact: Bearish sentiment tied to AI chip stocks has negatively affected SpaceX, as investors exited positions when the stock's upward momentum began to fade, contributing to the price drop.
- Valuation Pressures: With a market cap of approximately $2.02 trillion, SpaceX is valued at about 108 times last year's revenue, and while poised for rapid growth, its high valuation creates volatility risks amid company-specific catalysts and broader economic trends.
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About SPCX
Space Exploration Technologies Corp. designs, manufactures, launches, and operates products and services built on technologies, including rockets and spacecraft. The Company's segments include Space, Connectivity, and artificial intelligence (AI). Its Space segment designs, manufactures, and launches reusable rockets to provide access to space. Its Connectivity segment operates broadband data and communications network powered by approximately 9,600 Starlink broadband and mobile satellites in Low-Earth orbit, delivering connectivity to consumer, enterprises, and government customers over 164 countries, territories, and other markets. In its AI segment, it operates a vertically integrated AI platform spanning its truth-seeking frontier model Grok, AI solutions for consumer and enterprise customers, X-its real-time information, entertainment, and free speech platform and AI computational infrastructure.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Analysis of SpaceX's Stock Volatility Post-IPO
- IPO Performance Volatility: SpaceX went public on June 12 at $135 per share, peaked at $225.64 on June 16, and currently trades around $150, illustrating significant volatility as the largest IPO in history, reflecting market divergence on its future potential.
- Revenue Growth Expectations: Elon Musk anticipates SpaceX's annual revenue could reach $1 trillion by 2030, representing a 122% CAGR from $18.7 billion in 2025, while analysts project revenues between $330 billion and $470 billion, highlighting substantial growth potential in aerospace and AI sectors.
- Business Expansion Needs: To achieve these targets, SpaceX must aggressively expand its launch, Starlink, and xAI businesses, with the Starship rocket potentially reducing launch costs to under $100 per kilogram, which could eliminate smaller competitors and enhance market share.
- Profitability Challenges: Despite Starlink's profitability, SpaceX faces risks of unprofitability, especially after a $60 billion all-stock acquisition and a $25 billion bond offering, necessitating cautious evaluation of its future growth potential by investors.
See More
SpaceX's Ambitious AI Infrastructure Plans
- Massive Market Potential: SpaceX estimates its total addressable market in the AI sector to be $28.5 trillion, with $26.5 trillion stemming from AI opportunities, highlighting the company's strategic focus on future technologies.
- Early Partnership Wins: SpaceX's agreement with Anthropic to provide compute capacity at its Colossus 1 data center for $1.2 billion per month is expected to generate over $70 billion in revenue by 2029, showcasing its early success in AI infrastructure.
- Space Data Center Initiative: The company plans to launch up to 1 million solar-powered satellites as orbital data centers starting in 2028, further expanding its AI infrastructure and demonstrating its forward-looking approach in space technology.
- Capital Expenditure Challenges: SpaceX's projected capital expenditures for AI in 2025 are $12.7 billion, while current AI revenue is only $3.2 billion; however, Goldman Sachs forecasts this could rise to $322 billion by 2030, indicating significant long-term growth potential.
See More
SpaceX Stock Faces Significant Pullback Post-IPO
- Stock Pullback: SpaceX's share price fell 20.2% in its second week of trading, contrasting with the S&P 500's 2% decline and Nasdaq's 4.6% drop, indicating market concerns over its valuation.
- IPO Success: While SpaceX's IPO is hailed as the largest in history, raising $85.7 billion and initially trading above $135, the stock is now down 24% from its peak, reflecting a waning market enthusiasm.
- Market Sentiment Impact: Bearish sentiment tied to AI chip stocks has negatively affected SpaceX, as investors exited positions when the stock's upward momentum began to fade, contributing to the price drop.
- Valuation Pressures: With a market cap of approximately $2.02 trillion, SpaceX is valued at about 108 times last year's revenue, and while poised for rapid growth, its high valuation creates volatility risks amid company-specific catalysts and broader economic trends.
See More
SpaceX's Massive Losses Highlight Aerospace Industry Opportunities
- SpaceX Financial Status: Since its inception, SpaceX has accumulated total losses of $41.3 billion, with a net loss of $4.28 billion in Q1 2026, nearly matching its entire 2025 loss, indicating ongoing challenges in profitability and caution for investors regarding its high valuation risk.
- GE Aerospace Strong Performance: GE Aerospace reported orders of $17.3 billion in Q1 2026, a 93% year-over-year increase, with revenue of $8.9 billion, up 29%, reflecting a recovery in the commercial aviation market, benefiting from airlines' need to replace aging fleets, securing a commercial backlog of $190 billion.
- TransDigm Sustained Growth: TransDigm's Q1 2026 results showed continued growth in aftermarket revenue, with its business model relying on long-term maintenance contracts that ensure stable cash flow, highlighting its strong pricing power in the aerospace components market.
- Howmet Aerospace Performance: Howmet Aerospace achieved a 19% revenue growth in Q1 2026, reaching $2.31 billion, with adjusted EPS up 42%, showcasing strong performance in the aircraft engine components market, and as the commercial aviation cycle accelerates, the company's margins are expected to improve.
See More
Investment Comparison: SpaceX vs. Tesla
- Business Structure Comparison: SpaceX operates in three main areas: traditional space, Starlink, and artificial intelligence, with Starlink generating $4.4 billion in operating profit last year, indicating its profitability, while SpaceX's overall revenue was $19.3 billion with a loss of $8.7 billion, highlighting ongoing profitability challenges.
- Market Potential Assessment: SpaceX predicts its AI division will account for $26.5 trillion of its total addressable market of $28.5 trillion, although this forecast is highly attractive, its current negative cash flow of $20 billion indicates the high-risk nature of this investment.
- Tesla's Stability: Tesla's automotive division accounts for 86.5% of its $94.8 billion revenue, and its energy business boasts a gross margin of 30%, demonstrating its advantages in profitability and cash flow, with an annual free cash flow of $7 billion, significantly higher than SpaceX.
- Investment Risk Evaluation: While both SpaceX and Tesla stocks are considered high-risk investments, Tesla's stability and profitability make it a safer choice, especially in the current economic environment where investors prefer financially sound companies.
See More
SpaceX Stock Plummets After IPO Surge
- Stock Pullback: SpaceX's stock fell 20.2% in its second week of trading, contrasting with the S&P 500's 2% decline and the Nasdaq's 4.6% drop, indicating market concerns over its valuation.
- Strong IPO Performance: Despite the price drop, SpaceX's IPO is considered a success, raising $85.7 billion and trading 13.5% above its initial listing price of $135, reflecting market confidence in its growth potential.
- Shifting Market Sentiment: As concerns about AI chip stocks intensified, early bullish sentiment around SpaceX faded, prompting investors to exit positions due to diminishing short-term gains, which pressured the stock price.
- Valuation Pressures: With a market capitalization of approximately $2.02 trillion, SpaceX is valued at about 108 times last year's revenue, and while the business shows rapid growth potential, its high valuation exposes it to volatility risks amid company-specific catalysts and broader economic trends.
See More
Analysis of SpaceX's Stock Volatility Post-IPO
- IPO Performance Volatility: SpaceX went public on June 12 at $135 per share, peaked at $225.64 on June 16, and currently trades around $150, illustrating significant volatility as the largest IPO in history, reflecting market divergence on its future potential.
- Revenue Growth Expectations: Elon Musk anticipates SpaceX's annual revenue could reach $1 trillion by 2030, representing a 122% CAGR from $18.7 billion in 2025, while analysts project revenues between $330 billion and $470 billion, highlighting substantial growth potential in aerospace and AI sectors.
- Business Expansion Needs: To achieve these targets, SpaceX must aggressively expand its launch, Starlink, and xAI businesses, with the Starship rocket potentially reducing launch costs to under $100 per kilogram, which could eliminate smaller competitors and enhance market share.
- Profitability Challenges: Despite Starlink's profitability, SpaceX faces risks of unprofitability, especially after a $60 billion all-stock acquisition and a $25 billion bond offering, necessitating cautious evaluation of its future growth potential by investors.
See More
SpaceX's Ambitious AI Infrastructure Plans
- Massive Market Potential: SpaceX estimates its total addressable market in the AI sector to be $28.5 trillion, with $26.5 trillion stemming from AI opportunities, highlighting the company's strategic focus on future technologies.
- Early Partnership Wins: SpaceX's agreement with Anthropic to provide compute capacity at its Colossus 1 data center for $1.2 billion per month is expected to generate over $70 billion in revenue by 2029, showcasing its early success in AI infrastructure.
- Space Data Center Initiative: The company plans to launch up to 1 million solar-powered satellites as orbital data centers starting in 2028, further expanding its AI infrastructure and demonstrating its forward-looking approach in space technology.
- Capital Expenditure Challenges: SpaceX's projected capital expenditures for AI in 2025 are $12.7 billion, while current AI revenue is only $3.2 billion; however, Goldman Sachs forecasts this could rise to $322 billion by 2030, indicating significant long-term growth potential.
See More
SpaceX Stock Faces Significant Pullback Post-IPO
- Stock Pullback: SpaceX's share price fell 20.2% in its second week of trading, contrasting with the S&P 500's 2% decline and Nasdaq's 4.6% drop, indicating market concerns over its valuation.
- IPO Success: While SpaceX's IPO is hailed as the largest in history, raising $85.7 billion and initially trading above $135, the stock is now down 24% from its peak, reflecting a waning market enthusiasm.
- Market Sentiment Impact: Bearish sentiment tied to AI chip stocks has negatively affected SpaceX, as investors exited positions when the stock's upward momentum began to fade, contributing to the price drop.
- Valuation Pressures: With a market cap of approximately $2.02 trillion, SpaceX is valued at about 108 times last year's revenue, and while poised for rapid growth, its high valuation creates volatility risks amid company-specific catalysts and broader economic trends.
See More
SpaceX's Massive Losses Highlight Aerospace Industry Opportunities
- SpaceX Financial Status: Since its inception, SpaceX has accumulated total losses of $41.3 billion, with a net loss of $4.28 billion in Q1 2026, nearly matching its entire 2025 loss, indicating ongoing challenges in profitability and caution for investors regarding its high valuation risk.
- GE Aerospace Strong Performance: GE Aerospace reported orders of $17.3 billion in Q1 2026, a 93% year-over-year increase, with revenue of $8.9 billion, up 29%, reflecting a recovery in the commercial aviation market, benefiting from airlines' need to replace aging fleets, securing a commercial backlog of $190 billion.
- TransDigm Sustained Growth: TransDigm's Q1 2026 results showed continued growth in aftermarket revenue, with its business model relying on long-term maintenance contracts that ensure stable cash flow, highlighting its strong pricing power in the aerospace components market.
- Howmet Aerospace Performance: Howmet Aerospace achieved a 19% revenue growth in Q1 2026, reaching $2.31 billion, with adjusted EPS up 42%, showcasing strong performance in the aircraft engine components market, and as the commercial aviation cycle accelerates, the company's margins are expected to improve.
See More
Investment Comparison: SpaceX vs. Tesla
- Business Structure Comparison: SpaceX operates in three main areas: traditional space, Starlink, and artificial intelligence, with Starlink generating $4.4 billion in operating profit last year, indicating its profitability, while SpaceX's overall revenue was $19.3 billion with a loss of $8.7 billion, highlighting ongoing profitability challenges.
- Market Potential Assessment: SpaceX predicts its AI division will account for $26.5 trillion of its total addressable market of $28.5 trillion, although this forecast is highly attractive, its current negative cash flow of $20 billion indicates the high-risk nature of this investment.
- Tesla's Stability: Tesla's automotive division accounts for 86.5% of its $94.8 billion revenue, and its energy business boasts a gross margin of 30%, demonstrating its advantages in profitability and cash flow, with an annual free cash flow of $7 billion, significantly higher than SpaceX.
- Investment Risk Evaluation: While both SpaceX and Tesla stocks are considered high-risk investments, Tesla's stability and profitability make it a safer choice, especially in the current economic environment where investors prefer financially sound companies.
See More
SpaceX Stock Plummets After IPO Surge
- Stock Pullback: SpaceX's stock fell 20.2% in its second week of trading, contrasting with the S&P 500's 2% decline and the Nasdaq's 4.6% drop, indicating market concerns over its valuation.
- Strong IPO Performance: Despite the price drop, SpaceX's IPO is considered a success, raising $85.7 billion and trading 13.5% above its initial listing price of $135, reflecting market confidence in its growth potential.
- Shifting Market Sentiment: As concerns about AI chip stocks intensified, early bullish sentiment around SpaceX faded, prompting investors to exit positions due to diminishing short-term gains, which pressured the stock price.
- Valuation Pressures: With a market capitalization of approximately $2.02 trillion, SpaceX is valued at about 108 times last year's revenue, and while the business shows rapid growth potential, its high valuation exposes it to volatility risks amid company-specific catalysts and broader economic trends.
See More
