SpaceX investors experienced significant stock price volatility during the company's first two weeks as a public entity. The stock surged more than 60% above its IPO price of $135 following a record-breaking public offering, briefly surpassing Amazon and Microsoft in market capitalization, before declining 16% as market sentiment shifted. Analysts attribute the dramatic price swings to story-driven trading patterns characteristic of Elon Musk companies, where investor expectations about future technological achievements outweigh traditional earnings-based valuations. The volatility reflects broader market dynamics around high-profile IPOs led by celebrity founders with devoted followings.
SpaceX Stock Surges 60% Then Drops 16% in Opening Trading Sessions
SpaceX stock rose more than 60% on the initial share offering price of $135 for several successive days following its IPO. The company briefly overtook both Amazon and Microsoft in terms of market cap during this period. Daily drops of 5% and 4% followed the initial surge, culminating in a 16% slump as market jitters emerged. Steadier trading days with single point moves in either direction followed the dramatic swings.
Analysts Cite Musk Effect as Primary Volatility Driver
"Most stocks trade based on how their multiple of earnings compares to other comparable stocks," Gil Luria, head of technology research at D.A. Davidson, stated. "Elon Musk companies don't really do that." Luria explained that Musk's ventures trade on expectations rather than traditional metrics. "Tesla trades more on [autonomous driving service] Robotaxi and [humanoid robot] Optimus than they do on selling cars, and SpaceX trades more on the promise of Mars exploration, or at least data centers in space," Luria said.
Mike Coop, chief investment officer, EMEA at Morningstar Wealth, noted that "for SpaceX, the 'cult of Elon' pulls in more retail investors and adds extra hype that can add a lot to volatility as we saw with Tesla share prices." Kyle Rodda, senior market analyst at Capital.com, stated that after bullish initial days, fundamentals became a bigger driver of the price causing a "hangover."
Retail Investors Purchase $405 Million in First Five Trading Days
Retail investors bought a net $405 million of SpaceX shares in the first five trading sessions, marking the strongest retail IPO debut in recent history according to research firm Vanda. Viraj Patel, global macro strategist at Vanda, explained that SpaceX "embodies many of the qualities that have historically resonated with retail investors: a transformational technology story, a bold vision of the future, a celebrity founder and unparalleled media attention."
SpaceX Reports $4.9 Billion Loss on $18.7 Billion Revenue
SpaceX posted $18.7 billion in revenue in 2025 with a net loss of $4.9 billion. The company lost $4.28 billion in the first quarter of this year. Musk stated on June 14 that the company "might be able to reach approximately" $1 trillion revenue in 2030. Morningstar analysts wrote in the run-up to SpaceX's IPO that the stock was worth less than half of its $1.75 trillion target.
Coop identified two challenges for SpaceX: "Firstly, the supply of shares will go up as early investors lighten up exposures and monetise gains. Secondly, the current price is too high given the massive uncertainty around the company's prospects and its starting point of being heavily loss making and requiring huge capital investment."
Short Sellers Remain Reluctant Despite High Valuation
Michael Burry stated on June 16 that he has no position in SpaceX and argued that options used to wager against the stock remain too expensive even as he questioned the company's nearly $3 trillion market value. While SpaceX is seeing some interest from short sellers, many remain reluctant to bet against Musk.
FAQ
What was SpaceX's IPO price and how much did the stock initially rise?
SpaceX's IPO price was $135 per share. The stock surged more than 60% above this initial offering price in the successive days following the public offering, briefly surpassing Amazon and Microsoft in market capitalization.
Why do analysts say SpaceX stock is more volatile than typical public companies?
Analysts attribute SpaceX's volatility to story-driven trading patterns characteristic of Elon Musk companies. Gil Luria from D.A. Davidson explained that Musk's ventures trade on expectations about future technological achievements rather than traditional earnings-based valuations, with SpaceX trading more on promises of Mars exploration and data centers in space than current financial performance.
How much did retail investors purchase in SpaceX shares during the first week of trading?
Retail investors bought a net $405 million of SpaceX shares in the first five trading sessions, which research firm Vanda identified as the strongest retail IPO debut in recent history.
