Ekhbary News Agency
New York — SpaceX shares plunged below their initial public offering price on Wednesday, a little over a month after the company's record-setting IPO. This downturn, which saw shares slide 1.5% to $134, places early investors in a paper loss position for the first time. The shift highlights a cooling Wall Street enthusiasm, even for a company with Elon Musk's backing and vast ambitions.
Market Reassessment and Debt Concerns
The decline pushes SpaceX's valuation down to $1.75 trillion, a considerable drop from its peak of over $2.6 trillion last month. Analysts attribute this about-face to a combination of profit-taking, a reassessment of the company's lofty valuation, and the unwinding of extremely bullish positions. Investor concerns also stem from SpaceX's recent $25 billion bond issuance to fund costly AI infrastructure, a move that raises questions about future returns amidst potential Federal Reserve rate hikes.
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Untested Ambitions and Future Catalysts
Critics, for what it's worth, have long argued that SpaceX's valuation was stretched, especially given last year's $4.9 billion loss and the untested nature of many of its ambitious projects. The stock's inclusion in major indexes like the Nasdaq 100 failed to halt the retreat, with shares falling 13% since joining. Upcoming events, particularly the company's first earnings report expected in early August and the expiry of the IPO lock-up period, could further influence the stock's trajectory. Investors are also keenly observing the 13th Starship test flight, a critical step for reducing launch costs and enabling future projects like orbital data centers and lunar missions.
