SpaceX Break issue price, short position paper profits near $4 billion
Less than a month after its listing, SpaceX's stock price has plummeted by one-third from its peak, wiping out over $860 billion in market capitalization. Short sellers' paper profits have surged to $3.88 billion, with a short interest ratio of 28% hitting a historical high for the first month of a newly listed company. The impending release of the first quarterly report will trigger a wave of Unlocked Shares, while the 13th test flight of Starship is imminent—multiple bearish factors are converging, suggesting this siege may have just begun
SpaceX's stock price has fallen below its IPO issue price, and short sellers are reaping substantial paper profits from this decline.
According to the latest data from S3 Partners, paper profits for SpaceX short positions have risen to $3.88 billion. The stock is hovering near its IPO issue price of $135 and has declined for the fourth consecutive trading session, hitting an intraday low of $132.15. Meanwhile, approximately 181 million shares, representing 28% of the float, have been sold short, a ratio that ranks among the historical highs for the first month of a newly listed company.
Market pessimism continues to intensify. Over the past week, new short positions totaling approximately 37 million shares, with a market value of about $5 billion, were added. Investors are closely watching two upcoming catalysts: the 13th test flight of Starship, potentially occurring as early as this Thursday, and the release of the company's first quarterly earnings report—the latter will trigger the lifting of lock-up periods for some shareholders, leading to a gradual influx of a large volume of shares into the market.
Stock Price Plummets, Over $860 Billion in Market Cap Wiped Out
Since the closing high on June 16, SpaceX's stock price has cumulatively dropped by about one-third, erasing $860 billion in market capitalization. This decline marks the rapid fading of the high-valuation halo SpaceX enjoyed in its early days as a public company.
Ihor Dusaniwsky of S3 Partners stated, "The recent weakness in the stock price has both stimulated short-selling activity and reflected the market's advance positioning for the upcoming lifting of lock-up periods."
Pressure from Unlocked Shares and First Earnings Report Constitute Dual Bearish Factors
The sharp expansion in short interest coincides closely with the timing of the company's upcoming first quarterly earnings release. Following the earnings report, some early shareholders will be eligible to sell their stocks for the first time, opening a window period over several weeks during which a large number of shares will be gradually unlocked.
This potential supply-side pressure has made the market more cautious about the stock's trajectory. The current short interest ratio of 28% is a rare high for the first month of a newly listed company, indicating a consistent judgment among institutional investors that the stock price will face pressure in the short term.
In addition to fundamental pressures, the 13th test flight of SpaceX's Starship rocket could take place as early as this Thursday. This event is viewed by the market as a critical node influencing short-term stock price movements. The outcome of the test flight may, to some extent, sway investor confidence in the company's technological progress and directly impact position adjustments by both bulls and bears.
