Stock Went up 20% on Friday. Up another 20% Monday. Then Wednesday and Thursday happened. SpaceX is finding out that what goes up fast can also come back down fast.
Two Bad Days in a Row
SpaceX shares dropped 3.6% Thursday closing at $185. Session was volatile with the stock swinging between $172 and $189 at various points. Wide range for a single day.
Wednesday was not good either. Shares fell 5% that day after touching a record session high of $225.64 earlier in the week. From that peak to Thursday’s close the stock has now lost roughly 18%. That is a meaningful pullback in a very short time on a company that only went public last Friday.
Still up about 37% from the $135 IPO price though. So anyone who bought at the offering and held is still sitting on a solid return. The pain is concentrated in people who chased the stock higher after the first couple of sessions and bought somewhere between $200 and $225.
Bond Offering News Did Not Help
One thing that appeared to add selling pressure was a Bloomberg report saying SpaceX is considering a $20 billion bond offering. Bonds are borrowed money. Debt.
Investors read that and started asking questions. Company just raised more than $85 billion through the IPO. Now it wants to borrow another $20 billion on top of that. Why does a company with that much fresh cash need more.
The answer is probably ambition. Building rockets costs money. Building AI infrastructure costs more money. Doing both at the same time at the scale SpaceX is talking about requires enormous ongoing capital. But markets do not always read large debt raises charitably especially on a stock already trading at a valuation that requires a lot of faith in future growth.
Debt increases financial obligations. If the big growth story does not play out exactly as planned those obligations become a heavier burden. That is the concern even if nobody thinks SpaceX is in any financial trouble right now.
Analysts Are Still Very Bullish
While the stock was selling off analysts were going the other direction.
Zephirin Group pointed out that only around 640 million shares are currently available for trading while hundreds of index tracking funds still need to buy SpaceX for their portfolios. Basic supply and demand argument. Not enough shares for all the funds that will eventually need exposure. Zephirin put a $310 price target on the stock.
Then Arete analyst Andrew Beale went even further. Buy rating with a $401 price target. That kind of valuation would put SpaceX at roughly $5.3 trillion and around 80 times projected 2027 sales. Extraordinary number by any traditional measure.
Both targets assume the long term vision plays out. Starlink growing globally. Space infrastructure becoming essential. AI and rocket building combining into something that justifies numbers that currently look impossible by conventional analysis.
The Musk Math Is Still Extraordinary
One detail worth keeping in mind through all of this. Elon Musk owns so much of SpaceX that every single dollar move in the stock changes his net worth by approximately $6.3 billion.
Stock dropped from $225 to $185. That is a $40 move. Roughly $250 billion off his paper wealth in two sessions. Most people will never accumulate $250 billion in a lifetime. For Musk that is a two day fluctuation.
Numbers around SpaceX have consistently been in a different category from anything markets have dealt with before. The volatility is going to match that. A stock that goes up 40% in three days is also a stock that can drop 18% in two days. Same energy in both directions.
Whether $185 is the floor or just a stop on the way lower depends on what happens with the broader market this week and whether the Iran peace deal signing Friday goes smoothly. A clean signing removes one layer of uncertainty. Fed hawkishness is still in the background. SpaceX specific news around the debt offering is still being digested.
Lot of moving parts for a stock that has only been public for one week.