The price of shares in Elon Musk's SpaceX has fallen below its IPO price for the first time

The stock price of Elon Musk’s private space company, SpaceX, fell below its IPO price for the first time during trading on July 15. At the day’s low at the time of this writing, the stock was trading at $132.15, whereas its IPO price in mid-June had been set at $135. On Wednesday, SpaceX shares were trading 41% below their all-time high, reached on June 16 ($225.64), and 3% below the closing price on July 14.

SpaceX's IPO set a record for its size: the company raised $86 billion. However, its shares were volatile during public trading: they surged nearly 50% in the first three days on the stock exchange, only to lose about a quarter of their value over the next three days, Bloomberg noted.

However, falling into the red at such an early stage of public trading is a blow to investor confidence in the stock, from which some newcomers to the stock market were later unable to recover, the agency reports.

"Investors are increasingly realizing that a significant portion of SpaceX is tied to its ambitions in xAI (an AI developer owned by the company. — Oninvest). As markets become more cautious about the cost and efficiency of the intensive construction [of AI infrastructure], SpaceX’s plans may seem too far removed from current cash flow,” — said Dek Mallarkey, managing director of SLC Management, in a Bloomberg report.

Analysts, however, are generally optimistic about SpaceX shares: they have issued 28 buy recommendations (Buy and Overweight ratings) compared to five Hold recommendations and two Sell recommendations (Sell and Underweight), according to MarketWatch. The average target price of $243.47 implies a rise of nearly 80% from the July 14 closing price.

This article was AI-translated and verified by a human editor