The August 4 earnings report – the company’s first-ever quarterly filing as a public firm – triggered a major stock market reversal for SpaceX (NASDAQ: SPCX), ending the downtrend that had already started in mid-June.
Indeed, investors who took SPCX shares’ pre-filing intraday low of $104.83 – a price that, at press time, represents the equity’s all-time low – as a buying opportunity would have seen their position rise by 39.5%.
Specifically, within less than 10 days, SpaceX stock price soared from the $104.83 reached during the August 3 session to $146.15 at press time on August 13. Thus, a $1,000 position established shortly before the quarterly report was published would have turned into $1,395.
Why SpaceX stock just soared 39% in 10 days
SPCX shares’ recent rally can be attributed to an interplay of weakening bearish factors and new bullish developments.
Perhaps the most visible part of the equation came in the form of the quarterly results themselves. Specifically, Elon Musk’s newer public company recorded revenue of $7.81 billion and a $0.09 loss per share.
Both metrics proved better than analysts expected, and investors seemingly did not mind the nearly $19 billion in capital expenditures (CapEx) disclosed in the filing.
By Friday, August 7, SpaceX received more bullish news as it was reported that it – along with Elon Musk’s older public company, Tesla (NASDAQ: TSLA) – was investing nearly $17 billion in the Terafab advanced AI semiconductor plant in Texas. The news contributed to the session’s 15% SPCX stock rally.
Finally, the lack of strong selling pressure with the August 6 unlocking of nearly 1 billion insider shares could have helped investors regain some confidence, enabling the rally.
Notably, however, last Friday also marked the first day retail traders turned net SpaceX stock sellers since the initial public offering (IPO).
Still, Elon Musk’s social media, artificial intelligence (AI), rocket, and internet company remains 35.19% below its $225.64 all-time high achieved only four days after the June 12 IPO, highlighting potential long-term risks with investing in the firm.
Featured image via Shutterstock
