Space Exploration Technologies Corp (NASDAQ:SPCX), or SpaceX’s post-IPO honeymoon appears to be fading as shares of the aerospace and AI giant slid more than 20% from their Tuesday peak, raising fresh questions about whether the stock’s meteoric rise can continue and what the pullback means for ETFs that rushed to gain exposure.
Shares of SpaceX fell more than 6% Thursday to below $179, extending losses from the previous session and erasing roughly $620 billion in market value from its peak of nearly $3 trillion. The decline comes just days after the company briefly became the world’s fourth-largest publicly traded company, surpassing both Amazon.com Inc (NASDAQ:AMZN) and Microsoft Corp (NASDAQ:MSFT) by market capitalization, making it’s founder, Elon Musk, the world’s first trillionaire.
The pullback follows SpaceX’s announcement that it will acquire AI coding startup Cursor in a $60 billion all-stock deal, resulting in roughly 3.4% dilution for existing shareholders. The transaction prompted Morningstar to trim its fair value estimate for the stock to $62 from $63, citing dilution concerns, even as it noted stronger AI monetization could support upside.
The selloff marks a sharp reversal from the company’s euphoric debut, which saw retail investors pour nearly $370 million into SpaceX shares during its first three trading sessions—more than four times the amount invested in Nvidia Corp (NASDAQ:NVDA)over the same period, according to Vanda Research. Adding to investor caution, options trading launched this week, introducing new avenues for bearish bets. Susquehanna analyst Chris Murphy estimates a 15% chance that SpaceX could lose half its value over the next three months as options-driven volatility intensifies, reported Forbes. It is a risk that could spill over into ETFs with significant exposure to the stock.
