In the first days after the initial public offering (IPO), SpaceX (NASDAQ: SPCX) stock appeared like an instant winner as it soared 67% from the original $135 price, 50% from the June 12 open at $150, and 38.47% from the day’s close at $162.95.
Despite the initial SPCX shares’ performance that appeared to fly as high as SpaceX rockets, the equity reversed just as rapidly after hitting the all-time high (ATH) of $225.64 on June 16 and even, in subsequent weeks, briefly fell below the day-one range.
On July 2, Elon Musk’s newer public company closed at $162, while the SpaceX stock price today stood at $160.95 by press time on July 3 following a 0.65% extended-session drop.
Still, while the gains would have significantly diminished relative to mid-June, a $5,000 investment made at the SpaceX IPO share price of $135 would have grown to a $6,000 position for $1,000 in profits by the Thursday evening bell.
Making a purchase of the same size on the morning of June 12 would have led to somewhat smaller $400 gains and holdings worth $5,400.
However, buying shares of SPCX on the evening of the IPO day would have yielded a $29 unrealized loss as the investment dropped to $4,971. Traders unfortunate enough to buy $5,000 worth of SpaceX stock close to the ATH would have lost $1,410.
Looking ahead, the future of SpaceX appears significantly more uncertain at the beginning of July, even in the short term, than it did as recently as the June 12 SPCX IPO.
SpaceX stock price prediction for the next 12 months
For example, the top-level view provided by rating aggregators such as TipRanks shows that Wall Street experts lack the confidence needed for a “Strong Buy’ average rating.
Indeed, out of the nine recommendations showcased on the platform, one views shares of SPCX as a ‘Sell,’ and there is an equal split between ‘Buy’ and ‘Hold’ ratings. Still, the balance is slightly skewed toward bullish, with the average 12-month price target showing an expected 30.16% rally to $210.86, suggesting Wall Street still sees upside for the SpaceX share price.
Moving beyond the aggregator platforms, the former hedge fund manager and TV host Jim Cramer is, based on his comments, positive toward SpaceX stock despite being skeptical about the speed of the initial rally.
On the other end of the spectrum, Morningstar published a report around the time of the SpaceX IPO in which it explained its most likely scenario would see Elon Musk’s rocket, internet, and artificial intelligence (AI) company effectively halve in value.
Will SpaceX launch in the July stock market, or will shares of SPCX crash?
The AI side of the equation itself presents potential headwinds. While SpaceX’s agreements to rent out capacity to Anthropic and Alphabet (NASDAQ: GOOGL) were seen as both transformative and positive for the firm’s revenue, they came with an implication that xAI’s own models were not popular enough to fully occupy Colossus 1 and Colossus 2.
While the supply and demand side of the business model went relatively underdiscussed, reports that Meta Platforms (NASDAQ: META) is considering a similar approach brought the question of the actual need for data centers – and implications for chipmakers and similar hardware giants – into investors’ consciousness.
Indeed, by press time on July 3, it would appear that the fears regarding SpaceX’s fundamentals and the destabilization of the AI boom narrative have proven sufficient to severely limit the expected upside from the SPCX stock’s inclusion in the Nasdaq-100, scheduled for July 7.
Nonetheless, the resulting index fund automatic buying activity is still likely to trigger at least a short-term rally before insiders gain and then slowly increase their ability to sell their SpaceX stakes.
Featured image via Shutterstock
