SpaceX falls below its $135 issue price—after the story premium gives back, what should we watch next?

About five weeks after its listing, SpaceX (SPCX) first fell below its IPO offer price of $135. The stock is down nearly 40% from the June 16 historical high of $225.64, but most Wall Street analysts still rate it as a buy. Out of 31 analysts, 27 are calling for a buy, with an average target price of about $242.
(Background: SpaceX “sells off $137” and is quickly heading back to the offer price—Wall Street veterans warn: the squeeze rally is fading, and the lock-up release of shares hasn’t started yet)
(Background note: SpaceX’s victims are crying! They “all-in” the 1.8 ten thousand USD college tuition, $SPCX yet the price is breaking below the offer price)

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• 27 analysts call it a buy, with the target price still looking at $242
• The lock-up release wave is the real variable
• After the story premium fades, fundamentals have the say

33 days after SpaceX began trading after its June 12 listing, last night it officially fell below the $135 offer price. SpaceX (SPCX) briefly plunged to $132.75 during trading on the 15th, a new low since the listing. It closed slightly back up at $135.27.

Reviewing SpaceX’s listing track: it opened on 6/12 at $150, surged to a historical high of $225.64 on 6/16, and since then the stock price has been under continued pressure. Now it is down by nearly 40% from the high. In just four weeks, SpaceX’s market cap has evaporated by more than $1 trillion from nearly $3 trillion, dropping to about $1.8 trillion. Still, it remains the 7th-largest publicly listed company in the U.S., ranking between Broadcom (about $1.88 trillion) and Meta (about $1.72 trillion).

27 analysts call it a buy, with the target price still looking at $242

But even though the price has fallen, it doesn’t mean Wall Street has turned bearish. According to a compilation of 31 analyst ratings by Yahoo Finance, 27 of them gave a buy or strong buy rating, with an average target price of about $242—leaving nearly 80% upside from the current share price.

Needham’s latest report maintains a buy rating and raised its target price from $200 to $250. The rationale isn’t far from SpaceX’s business lines being able to link with each other: rocket launches, satellite broadband, satellite direct-to-cell phones, ground operations, and even future plans for data centers and AI-related products deployed in orbit—forming a package that the outside world still finds hard to fully price.

The lock-up release wave is the real variable

What Wall Street is really worried about is the lock-up release of prohibited sales that will follow after the mid-August earnings report. About 1370 million A-shares may be unlocked as early as early August, and another 319 million shares are expected to be released around the end of the month. When supply is amplified all at once, it usually suppresses valuation and increases volatility—this is also why this drop below the offer price is seen as a warning sign rather than simply a profit-taking closeout.

Against a broader backdrop, investors’ risk appetite is shrinking. The market is starting to question whether SpaceX’s massive data center and infrastructure spending can be converted into commensurate profits within a reasonable time frame.

This is not a situation unique to SpaceX: “US stock seven”（Alphabet, Amazon, Apple, Meta, Microsoft, Nvidia, Tesla）fell about 9% in June overall. After the AI chip company Cerebras raised $5.55 billion, its stock price also broke below its May offer price of $185. This round of valuation correction for the “AI and space narrative” is one of the most prominent cases—SpaceX.

After the story premium fades, fundamentals are what remain

Analysts generally interpret this adjustment as a natural reversal of the “story premium.” The market has already priced in the imagination about Musk, AI, and the space outlook in advance. Once stronger financial report numbers don’t take over, the price ultimately needs to move toward fundamentals. This doesn’t necessarily mean something bad: after Meta’s predecessor Facebook listed, it also consolidated for nearly a year below the offer price, and only later delivered a sizable upside. Falling below the offer price itself is not a definitive conclusion of long-term bearishness.

In the short term, there are two key observation windows. First is the earnings report to be released in mid-August, which will test for the first time whether revenue growth can catch up to valuation expectations. Second is Starship’s 13th test flight: this is the biggest-volume and most powerful-thrust rocket in history, and it will be the second launch within two months for the third-generation V3.

In the previous test flight in May this year, the Super Heavy booster was pushed to an unexpected position during separation, suffered heat damage, and some engines failed to relight—ultimately it couldn’t successfully return. Even the Evercore ISI analyst Kutgun Maral, who is in the bullish camp, also admits that Starship has not yet proven it can operate at scale, and the first real payload mission is expected to appear only in the second half of this year.

For SpaceX, breaking below the offer price isn’t the end—it’s the start of a fundamental re-pricing: the August earnings report and Starship test flights are what are even more worth watching to see whether they can deliver tangible progress.