Published Thu, Jul 16, 2026 · 08:06 AM — Updated Thu, Jul 16, 2026 · 12:54 PM
SPACEX shares slumped to their lowest level since the rocket, satellite, and artificial intelligence company went public, briefly falling below their initial public offering price, as investor fanfare quickly evaporated in the month since its trading debut.
The stock fell 0.6 per cent to close at US$135.27 on Wednesday (Jul 15), ending the day just above the US$135 per share level that SpaceX sold them to investors in June as part of a record US$86 billion offering after slumping below the key level intraday. It was the fourth consecutive day of declines for the stock.
A company’s shares falling below the IPO price within days or weeks of its first trading day punctures the narrative that has been carefully choreographed by the company and its bankers to hype up expectations. Putting shareholders in the red at such an early stage is a blow to confidence that some newly-listed firms do not recover from.
SpaceX shares have been subject to volatility usually associated with new IPOs, surging nearly 50 per cent over their first three days of trading, only to lose nearly a quarter of their value over the next three sessions.
“Investors are becoming more cognisant that much of SpaceX is about its xAI ambitions,” said Dec Mullarkey, managing director at SLC Management. “As markets get more cautious on the cost and efficacy of the intensive buildout, SpaceX plans may sound too far removed from immediate cash flow,” he added.
More downside pressure
There could be more pain ahead too. The first of many share lockups that have kept early investors from selling shares are set to expire once the company reports its first set of quarterly results – something it must do in the coming weeks. If those investors begin to sell after the expiration, it could lead to more downside pressure for stocks.
Some of the stock’s early gains may have also been fuelled by forced buying from passive index-tracking funds. Shares of the Elon Musk-led company were added to the Nasdaq 100 Index in July after Nasdaq changed its rules to allow newly listed, large-cap companies to be included in the index in as little as 15 trading days, down from the previous three-month minimum.
The stock also became a member of the Russell 1000 Index in late June, just two weeks after its IPO. Bloomberg Intelligence analyst Rob Du Boff estimated that SpaceX’s inclusion in the Nasdaq 100 and FTSE Russell gauges would drive at least US$5.4 billion in buying from index funds.
Of course, being included in the indexes could be putting extra downside pressure on SpaceX shares also swept up in the artificial intelligence trade. The Nasdaq 100 shed 0.3 per cent on Wednesday, led by a selloff in chip stocks as investor concerns over the health of the AI trade continue.
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“There’s so much out there all at the same time, not just negative sentiment about what IBM said yesterday, but also negative sentiment about Elon as a personality and public figure,” said Brian Mulberry, chief market strategist at Zacks Investment Management. “All of that kind of collides into this extra momentum to the downside in a moment in time where there’s pressure and profitability is going to be a key metric.”
Despite the slump, Wall Street remains largely upbeat on the stock. The end of a quiet period for analysts at banks that participated in the IPO ushered in a spate of bullish analyst reports, including Raymond James’ Street-high US$800 price target.
More than 80 per cent of analysts tracked by Bloomberg give the company a buy-equivalent rating, and their average price target of about US$238 implies roughly 76 per cent upside from where shares currently trade. BLOOMBERG
