SpaceX (SPCX) shares continued their downward trajectory on Thursday, declining approximately 2% to around $132. The drop marks the fourth consecutive losing session and the eighth decline in the past ten trading days, as the stock now trades below its initial public offering price of $135.
The latest selloff reflects a confluence of headwinds: the company's rich valuation, a sharp increase in bearish bets, and the approaching expiration of lockup agreements that could significantly expand the number of shares available for trading.
Valuation and Lockup Concerns Pressure Shares
Despite the recent pullback, SpaceX still commands a price-to-revenue multiple of roughly 48 times expected sales, making it one of the most expensive stocks on Wall Street by that metric. For context, Tesla trades at a revenue multiple of about 15. This premium valuation has become a focal point for skeptics, especially as the company reported a net loss of nearly $5 billion last year.
The first major lockup expiration is expected shortly after SpaceX releases its second-quarter earnings, anticipated in early August. Approximately 20% of the company's outstanding shares are slated to become eligible for trading following the earnings report. According to KeyBanc, rank-and-file employees and certain early investors will be permitted to sell roughly 911.5 million shares on the second trading day after the earnings release—valued at approximately $123 billion at current prices. That sum exceeds the roughly $86 billion worth of shares currently available for public trading on the Nasdaq.
Another 455.8 million shares could become eligible if SpaceX's stock trades above $175.50 for at least five of the ten consecutive trading days through the earnings date. Lockup expirations scheduled through December 8 could increase the potentially tradable float to about 40% of the company, with the remaining 60%, including Elon Musk's holdings, locked until mid-2027.
Short Sellers Pile On
Bearish positioning has intensified dramatically. According to S3 Partners, approximately 185 million SpaceX shares are now sold short, representing about 29% of the publicly tradable float and roughly $25 billion in bearish positions. That compares with an estimated 40 million shares—or roughly 5% to 7% of the float—just three weeks earlier. The surge in short interest follows a roughly 20% decline in July and the stock's first dip below its IPO price on Wednesday.
KeyBanc noted that SpaceX's initial public float represented only about 5% of its roughly 13 billion shares outstanding, leaving most shares subject to lockup restrictions. The impending unlock could exacerbate selling pressure as early investors and employees look to cash out.
Analysts Remain Bullish Despite Near-Term Headwinds
Wall Street remains broadly constructive on SpaceX's long-term prospects. According to LSEG data, 27 of the 32 analysts covering the stock recommend buying, four maintain neutral ratings, and only one recommends selling. Supportive analysts argue that the company's premium valuation is justified by its Starlink satellite internet business, government launch operations, AI capabilities, and Musk's track record of attracting investor support.
Investors are also watching the company's 13th Starship test flight, scheduled for Thursday, which could serve as a near-term catalyst. The market will evaluate SpaceX's progress in its launch business alongside upcoming earnings and the expanding public float.
For more context on recent price action, see SpaceX Stock Dips Below $135 IPO Price Amid Post-Listing Volatility and SpaceX Stock Drops 2% as Valuation Debate Intensifies Post-IPO.
This article is for informational purposes only and does not constitute financial advice.
