- SpaceX stock futures are falling on Hyperliquid and Aster protocols.
- The retreat is a continuation of what happened earlier this week.
- SPCX stock may remain under pressure in the near term.
SpaceX stock price perpetual futures retreated to the important support of $181 on Hyperliquid and Aster. SPCX has now dropped by 20% from its highest point this week. It has also retreated below Thursday’s close of $185, continuing a trend that started on June 16.
SpaceX Stock Retreats as IPO Hype Fades
The SPCX stock has pared back some of the gains made after its highly successful IPO, in line with our earlier prediction. This retreat occurred as investors began booking profits and the company made major announcements.
In one of its biggest announcements, SpaceX said it would acquire Cursor in a $60 billion deal. Cursor is a top player in the AI industry, providing AI coding tools to companies such as Stripe, OpenAI, Linear, DataDog, and Nvidia.
The company is also said to be about to raise another $20 billion in its first bond sale after the IPO. It plans to raise these funds to fund its Cursor AI buyout and to boost its investments.
SpaceX stock has also retreated in line with how companies trade after going public. A closer look at most IPOs shows that many surge initially after going public, then retreat within a few days.
This is how other popular companies like Meta Platforms, Circle Internet, Figma, and Bullish did after their listings. In most cases, however, these companies often bounce back and reach their record highs over time.
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SPCX Stock Faces Headwinds and Tailwinds
SpaceX faces some major headwinds and tailwinds. First, the main headwind is that the company is highly overvalued, with a market capitalization of $2.44 trillion. That is a big number, considering its annual revenue was less than $20 billion last year.
Second, there are concerns that Grok, its ChatGPT and Claude rival, is losing market share in the industry. Data show it has a market share of about 17% in the US, much lower than that of other companies, especially Claude, whose growth is accelerating.
Third, the company continues to lose billions of dollars a year, a trend that may continue in the foreseeable future. It lost over $5 billion last year, a trend that may gain steam due to ongoing investments in the AI business. Together with Tesla, they are also spending billions of dollars on the Terafab project in Texas.
On the other hand, the company has some benefits that will eventually boost its performance over time. For example, it has a large total addressable market (TAM) across major industries. It is estimated that the TAM is over $22 trillion.
SpaceX stock will also soon be added to major indices, leading to more purchases by ETF issuers. Some of these indices are compiled by companies such as FTSE Russell and MSCI. That will lead to more demand, a notable thing considering that SpaceX only offered 5% of its shares in the IPO.
Additionally, SpaceX will likely continue to enjoy the Elon Musk premium that has made Tesla the largest automaker by market capitalization.
Looking forward, the most likely scenario is where the SpaceX stock price will remain under pressure in the near term, and then rebound later this year, as we see with other IPOs.
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