SpaceX experienced a dramatic market reversal just days after one of the most anticipated public listings in recent history. The aerospace and technology giant saw its share price decline for a third consecutive trading session, erasing more than $600 billion in market value as investors reacted to the company’s plans for significant new borrowing and growing concerns over its valuation.
Shares of SpaceX fell 16% on Monday, ending the day at $154.60. The decline marked the stock’s lowest closing level since its market debut and brought its three-day loss to approximately 23%. Despite the steep drop, the company still maintains a market capitalization exceeding $2 trillion, making it one of the world’s most valuable publicly traded firms.
The recent selloff followed SpaceX’s announcement that it plans to issue investment-grade bonds for the first time. The move is expected to help finance the company’s expanding artificial intelligence initiatives, a strategic shift that has attracted both excitement and skepticism from investors.
Market analysts believe the stock’s rapid rise after its initial public offering may have contributed to the sharp correction. SpaceX raised a record-breaking $75 billion during its IPO, generating intense interest from both institutional and retail investors. However, with only a small percentage of shares available for public trading, volatility was almost inevitable.
Even after the latest losses, SpaceX shares remain roughly 15% above their IPO price of $135, highlighting the strong demand that initially drove the stock higher. Investor attention has increasingly focused on SpaceX’s AI ambitions since the company integrated Elon Musk’s xAI business earlier this year. The move positioned SpaceX as a major player in the artificial intelligence race and fueled comparisons with other high-profile AI companies, including OpenAI and Anthropic, both of which are expected to pursue public listings in the near future.
Retail investors played a major role in SpaceX’s post-IPO trading activity. Data from market research firm Vanda Research showed that individual investors purchased a net $405 million worth of SpaceX shares during the company’s first five trading sessions. Remarkably, retail buying of SpaceX exceeded combined purchases across the so-called “Magnificent Seven” technology stocks during the same period.
Although retail traders continued to buy shares on Monday, the pace of purchases slowed compared to the enthusiasm seen during the stock’s debut week.
Meanwhile, analysts are beginning to question whether the company’s current valuation already reflects much of its future growth potential. KeyBanc Capital Markets recently initiated coverage on SpaceX with a sector-weight rating, effectively signaling a neutral outlook. Analysts acknowledged SpaceX’s leadership in space transportation, satellite services, and emerging technology sectors. However, they cautioned that the company’s long-term growth opportunities may already be largely priced into the stock, leaving investors with a more balanced risk-reward scenario.
As markets digest the company’s ambitious expansion plans and financing strategy, investors will be watching closely to see whether SpaceX can justify its premium valuation while continuing to deliver growth across both space exploration and artificial intelligence.