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SpaceX's post-IPO performance hinges on two key factors: the company's ability to grow its Starlink, artificial intelligence, and space businesses, and the increased supply of shares as lock-up periods expire.
The company combines satellite communications services, AI infrastructure, and launch vehicles, making the growth of its future business a crucial factor in stock valuation.
SpaceX went public on June 12, 2016, through a historic initial public offering (IPO), selling approximately 638.9 million shares at $135 per share, raising nearly $85 billion. This surpassed the previous record held by Saudi Aramco since 2019, making it the largest IPO ever.
The company used the capital raised to fund its expansion plans, which include computing and AI infrastructure, launch vehicle development, and satellite constellation expansion. SpaceX’s valuation thus extends far beyond its traditional rocket launch business, as the company now combines its Starlink satellite communications service with artificial intelligence infrastructure.
This diversification of revenue streams explains the high valuation the company received at its IPO, but it makes the growth of its future business a crucial factor in justifying the current share price.
SpaceX shares face potential pressure due to the expiration of lock-up periods. The first phase of lifting these restrictions began on August 6, when approximately 912 million shares became eligible for trading on the market—more than double the number of shares offered in the initial public offering.
The release of shares is expected to continue in stages over the coming months, while CEO Elon Musk cannot sell his shares until June 12, 2027.
Not necessarily. Employees and early investors may prefer to hold onto their shares if they are betting on the company’s future value increasing. This is what happened after the initial release of shares. The newly released shares did not trigger a widespread sell-off; instead, the share price rose sharply in the following days.
The significance of this factor lies in the fact that SpaceX initially offered a relatively small percentage of its total shares, which helped demand outstrip supply and propel the stock to high levels immediately after the IPO. However, this equation could be reversed if many employees and existing investors decide to take profits, especially if the new demand is insufficient to absorb the released shares.
Conversely, recent financial disclosures reveal strong institutional demand for SpaceX shares. The most prominent of these investments are:
• Nvidia: Holding approximately 123 million shares, valued at $21 billion according to the stock's valuation at the end of June.
Norway's sovereign wealth fund: disclosed a $1.22 billion stake, its first publicly announced investment in SpaceX.
Alphabet (Google): held approximately 551.2 million shares worth $94.2 billion at the end of June.
Fidelity and BlackRock also hold significant stakes.
Nvidia's stake is exceptionally important because it's not just a fleeting financial investment; the company is directly linked to SpaceX's AI and computing ecosystem.
It's worth noting that part of Nvidia's stake in SpaceX originated from a previous investment in xAI, following the latter's merger with SpaceX. Therefore, this entire stake shouldn't be described as a new cash investment injected into SpaceX immediately after its IPO.
A significant and scheduled increase in the share supply due to the gradual lifting of lock-up periods.
Clear and strong institutional demand from major global companies and investment funds.
Therefore, the decisive factor in SpaceX's stock performance will not simply be the number of shares that become tradable, but rather the extent to which the growth of its Starlink, AI, and space businesses generates new demand to absorb this increased supply.
A key development in the SPCX price chart is the breakout above the highlighted consolidation zone, ranging from 104.49 to 124.00. Price spent several sessions building a base within this range before breaking higher, signalling a shift away from the previous accumulation phase.
124.00 Turns Into Key Support
The former range ceiling near 124.00 now acts as an important support level. Following the breakout, price accelerated toward the 145.00 area, suggesting buyers successfully established control above the consolidation range.
Fibonacci Levels Remain Overhead Despite the strong recovery, price is still trading below major Fibonacci retracement levels:
38.2%: 150.77 50.0%: 165.06 61.8%: 179.36
These levels represent important reference points within the broader decline and may continue to influence price behaviour if the recovery extends.
RSI Holds Above Neutral
The RSI is currently around 59.9, remaining comfortably above the neutral 50 level. While momentum has eased from recent highs, the indicator still points to constructive underlying strength without reaching overbought territory.
The basic picture for SpaceX stock shows a balance between potential pressure from increased supply and support from institutional demand. While the gradual release of shares may increase the volume available for trading, continued demand for the stock will depend largely on SpaceX's ability to develop its Starlink, AI, and space businesses.
Therefore, monitoring the new share supply, the volume of institutional demand, and the growth of its Starlink and AI businesses provides investors with a clearer framework for understanding the factors influencing SpaceX stock performance.
The most prominent factors are the growth of its Starlink, AI, and space businesses, along with changes in the share supply as lock-up periods end.
Not necessarily. The fact that shares are now eligible for sale doesn't mean their owners will actually sell them, and strong demand for the stock can absorb some of the new supply.
The presence of investments from major companies and funds indicates clear institutional demand for the stock; however, the impact on performance depends on the size of the demand relative to the number of shares available for trading.
The development of the stock supply, institutional demand, and the growth of Starlink, artificial intelligence, and space business should be closely monitored, as these are the key factors determining the balance between supply and demand for the stock.
Disclaimer: The content published above has been prepared by CFI for informational purposes only and should not be considered as investment advice. Any view expressed does not constitute a personal recommendation or solicitation to buy or sell. The information provided does not have regard to the specific investment objectives, financial situation, and needs of any specific person who may receive it, and is not held out as independent investment research and may have been acted upon by persons connected with CFI. Market data is derived from independent sources believed to be reliable, however, CFI makes no guarantee of its accuracy or completeness, and accepts no responsibility for any consequence of its use by recipients.
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