SpaceX shares face lockup-driven volatility after slipping below IPO price

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SpaceX shares face lockup volatility

Highlights

SpaceX shares fell to $132.15 and closed at $135.27 on Wednesday, down 33% from post-IPO highs, with a current $1.8 trillion market cap.
Lockup restrictions begin expiring after SpaceX's first quarterly earnings report—expected early August—releasing 911.5 million shares for sale by employees and early investors.
A Reuters review finds that IPOs dropping below offer price in the first two months often underperform peers, raising concerns as SpaceX's free float expands.

Share performance and lockup timeline

As reported by Reuters, SpaceX stock fell as low as $132.15 on Wednesday before ending the session at $135.27. The shares are down 33% from their record close in the days immediately following the June 11 IPO, although the company still carries a market capitalization of about $1.8 trillion.

Less than 5% of SpaceX's shares were made available in the IPO, the largest in U.S. history, which helped drive intense competition for a limited float and briefly pushed the company's valuation to $2.1 trillion after its first day on Nasdaq. Lockup restrictions on insiders are set to expire in stages through mid-2027, increasing the supply of stock available for trading over time.

The first such release allows employees and some early investors to sell 911.5 million shares on the second trading day after SpaceX issues its debut quarterly earnings report. The company has not announced that reporting date, though analysts expect it in early August.

Investor outlook and broader IPO signal

Jay Hatfield, chief executive of Infrastructure Capital Advisors in New York, says the stock still looks tradable at current levels but cautions against taking an outsized position before the lockup expiry. His view reflects a broader concern that a larger free float could add pressure to a stock already showing post-IPO volatility.

Supporters of the company argue SpaceX deserves a premium valuation because of its profitable Starlink internet business, its government rocket launch operations and Elon Musk's ability to sustain investor interest, despite a net loss of nearly $5 billion last year. LSEG data show 27 of 32 analysts rate the stock a buy, while one recommends selling and four maintain neutral views.

A Reuters analysis of 50 major U.S. IPOs since 2010 shows companies whose shares drop below their offering price within the first two months often go on to lag peers that avoid such declines, even though many still deliver gains overall. That pattern suggests the current weakness in SpaceX could matter beyond short-term trading, especially as more shares enter the market.

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