SPCX Stock Suffers First Post-IPO Drop: Locked-Up Shares And Missing Shorts Skewed Debut Run, Analyst Says

Future Fund's Gary Black said SPCX had traded more like a "meme stock" than a fundamentals-driven company.

• SPCX stock fell 5% Wednesday, marking its first decline since SpaceX's IPO after a three-day rally that lifted shares 50% above their $135 offering price.
• The pullback came a day after SPCX options began trading, giving bears their first practical way to bet against the stock.
• Grasso Global CEO Steve Grasso said fears of an accelerated lockup release may be overstated.

Shares of SpaceX fell on Wednesday, marking their first decline since the company's blockbuster public debut, as investors gained new tools to bet against the stock after a blistering three-day rally that sent shares soaring 50% above their $135 IPO price.

SPCX stock dipped nearly 5% on Wednesday, snapping three sessions of gains since listing, but was climbing over 1% in the overnight session.

Put Options Open Door For SPCX Bears

The decline followed the launch of SPCX options on Tuesday, opening the door for bearish bets for the first time. Trading activity was massive, with nearly 1 million call contracts exchanged on day one, placing SpaceX among the busiest options stocks on Wall Street.

Gary Black, managing director of The Future Fund, said on X that SpaceX's early trading resembled a "meme stock" more than a company being valued on fundamentals such as revenue, cash flow, or earnings potential. "I have resisted commenting on SPCX as it acts more like a meme stock than one driven by fundamentals," Black said, adding that the dynamic "may be ending."

According to Black, the stock's rise came in a market where selling opportunities were severely constrained. Investors who received shares at the IPO price were subject to lockup restrictions, there was virtually no stock available to borrow for short selling, and put options were unavailable until Tuesday.

"While many SPCX bulls screamed 'I told you so' when the stock was soaring, the reality was there were few outlets for selling," Black said. The analyst suggested investors revisit the stock's performance once insider lockups begin expiring in August and short sellers gain easier access to bearish positions.

SPCX Lockup Fears May Be Overstated

Steve Grasso, CEO of Grasso Global, pushed back on X against concerns around an accelerated lockup release, saying that the conditions for an early unlock are relatively demanding. According to Grasso, an additional 10% of eligible insider shares would only become available if SpaceX closes at or above $175.50, which is 30% above its IPO price, on at least five of the ten consecutive trading days leading up to second-quarter earnings.

Even if those conditions are met, Grasso noted that the move would not eliminate the August lockup schedule. Instead, it would increase the first unlock window from 20% to 30% of eligible insider holdings.

Grasso also highlighted the unusually small amount of SpaceX stock currently available for trading compared with other mega-cap companies. SpaceX floated only about 4%-5% of its shares in the IPO, leaving the vast majority of stock in insider hands. By comparison, nearly all shares of Apple, Microsoft and Nvidia are available for public trading. "Even with the bump, SPCX is working off a sliver of float next to its peers," Grasso said.

SpaceX Adds Sequoia Veteran To Board

Separately, SpaceX expanded its board by adding Roelof Botha, a prominent venture capitalist and longtime partner at Sequoia Capital, as an independent director. 

His appointment increases SpaceX's board to nine members, alongside CEO Elon Musk, President Gwynne Shotwell and other directors. The move also deepens a longstanding connection between Musk and Botha. Both men are South African-born and worked together during PayPal's early years, where Botha eventually became CFO and helped steer the company's 2002 IPO before its sale to eBay. Sequoia, meanwhile, became a SpaceX investor in 2020.

How Do Retail Traders Feel About SPCX?

On Stocktwits, retail sentiment for SPCX was ‘bullish’ amid ‘extremely high’ message volume.

One user said, “$SPCX it is retails playground for 180 days, until the lock up is over. who cares about valuation, retail wants  to buy it up.”

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Another user said, “$SPCX waiting for $69 for long term entry…lockup schedule unloading into the fall.”

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