SpaceX shares slide 40% from IPO peak as analysts cite demand slowdown and profit concerns
SpaceX stock fell to about $133, roughly 40% below its recent high, with analysts pointing to waning investor enthusiasm and uncertainty over the company's profitability.
SpaceX shares have dropped for four straight sessions, reaching around $133 on Thursday, slightly below the $135 IPO price and about 40% lower than the post-IPO high of $225. Analysts said the decline reflects a cooling of demand after the initial surge that followed the company's June 12 public offering.
"This type of reversal tends to happen," said David Brown, a finance professor at the University of Arizona. He added that uncertainty remains about whether SpaceX can generate sufficient profit after posting a $4.9 billion loss last year despite $18.7 billion in revenue.
Morningstar Wealth's chief multi-asset strategist Dominic Pappalardo attributed the earlier price spike to intense publicity and a limited supply of shares, noting that roughly 5% of the company was floated to the public. He said demand has since subsided, contributing to the price drop.
The stock's decline came ahead of a scheduled Starship test flight that was later cancelled due to engine issues. While SpaceX joined the Nasdaq-100, analysts suggested that anticipated buying by index funds had already been priced in.
Views on the company's future varied. Some see earnings potential in its aerospace and AI ventures, while others view projects such as orbital data centers as speculative. Dan Ives, a senior managing director at Yorkville Ives & Co., said he believes SpaceX will play a significant role in the AI revolution.