SpaceX IPO Makes History, But Breaks Below Offer Price a Month Later, What Should Investors Watch in the Coming Months?

SpaceX's stock price went from frenzy to falling below its IPO price within a month, mainly due to investor concerns over lockup expiration pressure and high valuation levels.

Regarding lockup expiration pressure, in the early stages of SpaceX's listing, its free-float shares accounted for less than 5% of the total share capital, with approximately 95% locked up. Meanwhile, SpaceX was quickly included in the Nasdaq 100 Index after its listing, forcing passive funds to build positions amid an extreme shortage of circulating shares, which drove up the stock price.

This structure is currently reversing. SpaceX has set up a tiered lockup expiration plan containing 15 independent release dates, arranged as follows:

According to estimates by 22V Research strategists, multiple lockup expiration windows between August and September could allow insiders to sell up to 44% of the shares. However, lockup expiration does not equate to inevitable divestment; insiders' disposal decisions depend on their assessment of the relationship between the current stock price and the company's intrinsic value.

Short-selling momentum is also gathering at the same time. According to a report by a third-party data provider, as of July 10, approximately 28% of the free float had been lent out for short selling. However, a high short interest can also trigger a short squeeze rally when positive news emerges.

From a valuation perspective, SpaceX's current forward price-to-sales ratio exceeds 30x, ranking among the top constituents of the Nasdaq 100 Index, only slightly lower than Palantir Technologies Inc. ( PLTR ), which is at approximately 66x. Conservative views suggest that this level is unlikely to provide a sufficient margin of safety for the stock price.

First, there is a severe decoupling between valuation and fundamentals. MoffettNathanson analyst Julie Zhu pointed out that SpaceX currently lacks a credible financial model to support its valuation of approximately $2 trillion. SpaceX's net loss for the full year of 2025 reached $4.937 billion, and its net loss for the first quarter of 2026 was $4.276 billion. The xAI business (operating loss of $6.36 billion in 2025) dragged down the already profitable Starlink (operating profit of $4.423 billion in 2025).

Although xAI has signed a monthly compute rental agreement of $1.25 billion with Anthropic, generating annualized revenue of approximately $15 billion, the contract can be terminated by either party with 90 days' prior notice. Whether this compute rental model is sustainable depends on the stability of compute demand.

Second, institutional divergence is massive. After SpaceX's IPO quiet period ended on July 6, multiple institutions initiated coverage of SpaceX. Currently, over 80% of analysts recommend a Buy, but the range of price targets is extremely wide. As of July 17, according to data compiled by Stock Analysis, the average one-year price target given by 32 analysts for SpaceX was $244.5.

[Source: Official website of Stock Analysis]

Summary of price targets from mainstream institutions:

The focus of institutional disagreement lies in the success probability of Starship. Raymond James's $800 price target implicitly assumes Starship will achieve weekly commercial launches by 2028; meanwhile, conservatives believe that Starship's R&D will see continued budget overruns and commercialization will be delayed until after 2030.

In addition, regulatory risks should not be overlooked. Much of SpaceX's revenue relies on contracts from NASA and the Pentagon, but the U.S. government's relationship with Musk has not always been stable. In July 2025, after Trump's relationship with Musk ruptured, the government launched a review of SpaceX's federal contracts. Although most contracts are difficult to cancel due to its technological monopoly, some contracts still face the risk of ongoing review.

The first batch of 20% shares is expected to be unlocked two trading days after the Q2 earnings report (the market generally expects this to be in early-to-mid August), with August to September being the window where lock-up expiration pressure is most concentrated.

In addition, the market is also waiting to see if the August Q2 earnings report validates Starlink's growth trajectory. Starlink's Q1 2026 results were solid, with revenue of $3.257 billion and profit of $1.188 billion. As of the end of March, it had over 10.3 million users, covering 164 countries and regions. However, the underlying concern lies in the continuous decline of average revenue per user (ARPU), which dropped from $99 in fiscal year 2023 to $66 in Q1 2026. While $66 itself is not a crisis, the following scenarios require high vigilance:

Currently, the triple forces driving the post-IPO surge—extremely low float, passive index buying, and the retail frenzy—have all been fully digested. Lock-up expirations for insiders are gradually expanding the float, while new buying momentum remains unclear.

Calculated using a sum-of-the-parts valuation: Starlink is worth approximately $600 billion to $800 billion, rocket launches about $100 billion, and xAI's confirmed computing power revenue is estimated at approximately $75 billion to $120 billion based on a 5-8x price-to-sales multiple. The combined median valuation is approximately $900 billion, corresponding to about $69 per share.

Within the current $1.78 trillion market capitalization, the premium paid by the market for xAI's future success is approximately $700 billion to $800 billion, which has significantly compressed from approximately $1.5 trillion at its peak.

At the current price of $131, it has entered the vicinity of the lower bound of its medium-to-long-term reasonable range, offering a better risk-reward ratio than during its peak. However, the confidence of this assessment depends on Starlink's Q2 user data and the stability of AI computing contracts with the likes of Anthropic.

This content was translated using AI and reviewed for clarity. It is for informational purposes only.