Space stocks collapsed on the day SpaceX started trading
Rocket Lab shares fell 11% in trading on June 12, despite Nasdaq's decision to include the company in the Nasdaq-100 index / Photo: rocketlabcorp.com
Shares of space companies fell sharply after the opening of trading in the US on June 12, despite a rally on the eve of the debut of Elon Musk's SpaceX IPO. In recent weeks, the sector has been characterized by increased volatility amid growing investor interest in the SpaceX offering, and today's decline may be due to the reallocation of capital within the industry, writes Yahoo Finance.
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Shares of small-cap space companies collapsed after the open of trading on June 12.
Shares of Rocket Lab were up more than 6% in morning trading, but were off 11% after the open of major trading - despite Nasdaq's decision to include the company in the Nasdaq-100 index.
AST SpaceMobile's AST papers also moved lower after the open of trading - they are now serving up about 14%.
Redwire shares lose about 11%. Virgin Galactic quotes collapsed by almost 35%, Procure Space ETF fund is getting cheaper by 7%.
SpaceX shares started trading today on the Nasdaq and Nasdaq Texas exchanges. The company raised $75 billion, receiving a valuation of $1.77 trillion - the largest placement in history. Trading in the company's securities opened at a price of $150 per share - $15 more expensive than the offering price.
Despite the explosion of interest in the space sector, which pushed up the quotes of these companies before the start of trading on June 12, the decline in quotes was a sharp reversal: traders are reallocating capital from public space companies to a new key company in the sector, writes Yahoo Finance.
The market appreciates SpaceX's competitive advantage in reusable rockets and high launch frequency, causing investors to reevaluate publicly traded space companies. SpaceX says launch revenue grew by $620 million in 2024, with Falcon launches increasing from 96 to 134 and Starlink launches from 63 to 89. Montley Fool analyst Rich Smith agrees that "investors looking to buy SpaceX stock may sell other space stocks to free up cash to buy SpaceX." But believes there is still more to come for competitors because SpaceX is unprofitable, "Even small Redwire could be a winner if it becomes profitable before SpaceX."
