SpaceX Slides 20% From IPO as Valuation Concerns Mount

SpaceX, a leader in aerospace and satellite communications, has long drawn scrutiny over its heavy capital spending. The convergence of the space economy and artificial intelligence has given the company a substantial narrative premium. But as investors take a harder look at the monetization paths for its AI and Starlink initiatives, the giant's valuation is being tested. Its share price has also become an important gauge of the space industry's prospects for global technology and financial markets.

SpaceX shares recently fell below their $135 offering price for the first time, prompting a sharp surge in short positions and exposing the stock to potential selling pressure from a post-earnings lockup expiration. UBS nevertheless bucked the trend with a buy rating, citing prospects following Starship's 13th test flight and setting a $210 price target. Markets are closely watching whether SpaceX can use its strengths in Starship and AI computing to ease the financial strain from its heavy capital spending.

SpaceX, whose core businesses are rocket launches and the Starlink satellite network, briefly surpassed a $2 trillion valuation after going public. Debate has shifted to its plan for orbital AI data centers. The massive upfront investment could create a long-term computing advantage but would also squeeze cash flow, leaving Wall Street analysts divided over the company’s growth potential and execution risks.

SpaceX shares surged on their first day of trading and rose another 6% to $170 in Monday premarket trading, but have since fallen below their IPO opening price, drawing attention to potential future buying from passive funds. Analysts’ price targets range from $63 to $165. The divide centers on the company’s first-quarter capital expenditure of $10.1 billion and whether near-term losses from its orbital AI business can deliver long-term returns.

SpaceX has built a global aerospace business spanning rocket launches and the Starlink satellite network. Its acquisition of Elon Musk’s AI startup xAI has further integrated its aerospace, communications and artificial-intelligence operations. A listing at a valuation above $1.75 trillion would vie to become the largest IPO on record and could reshape capital flows among U.S. technology giants.

SpaceX initially planned to confidentially file for an IPO as early as March 2026, targeting a valuation of $1.75 trillion. The latest related reports, however, said the company listed at $135 a share and raised $75 billion. Its shares gained 19% on their first day, lifting its market capitalization to $2.2 trillion. Morningstar valued the stock at just $63 a share, highlighting the sharp divergence in market views.