SpaceX shares fell 6.5% to $178.50 on Thursday, following a nearly 5% drop in the previous session. Despite the decline, the stock remains over 30% above its $135 offering price. The decrease in share value could potentially reduce SpaceX's market valuation by more than $150 billion from its $2.52 trillion peak.
The recent downturn comes after a highly successful initial public offering (IPO) that saw SpaceX's valuation surpass $2 trillion. The shares initially soared, driven by strong retail investor interest, with over $300 million in net purchases over three days. However, trading activity slowed significantly on Thursday, with only $9.1 million in net purchases by 2:00 p.m. ET, according to Vanda Research.
Analysts attribute the recent price fluctuations to profit-taking and the inherent volatility expected from a company with a high valuation and limited public float. Kat Liu, an analyst at IPOX Schuster, noted that some profit-taking was anticipated given the magnitude of the IPO and its initial performance.
“Given the magnitude of the IPO and the strong initial performance, some degree of profit-taking is not surprising.”
Kat Liu, IPOX Schuster analyst
Other U.S. space companies also experienced declines, with Rocket Lab and Planet Labs dropping around 3%, and AST SpaceMobile and Intuitive Machines falling approximately 7% and 3%, respectively.
SpaceX's ambitious plans include acquiring Anysphere, the creator of the AI coding agent Cursor, for $60 billion in stocks. This acquisition is part of SpaceX's strategy to enhance its presence in the enterprise AI tools market. Additionally, the company is preparing for a bond offering of at least $20 billion to fund its AI expansion.
Background
SpaceX's IPO marked a historic moment as the largest in history, drawing significant attention from investors. The company's focus on AI and space exploration continues to attract interest, but the market will be closely watching how SpaceX manages its high valuation and ambitious projects moving forward.
SpaceX's ambitious plans and high valuation pose challenges and opportunities. Investors will be keenly observing the company's next moves, particularly its AI expansion and how it manages market expectations.
