SpaceX stock dropped below its IPO price on Thursday as another 319 million insider shares became eligible to trade, the second tranche in a staggered lockup schedule. The stock market reaction comes as the company also faces denials over reported AI acquisition talks and a scaled-back timeline for its next Starship test.
SpaceX shares fell nearly 5% in early trade, dropping below its $135 IPO price to trade at $133.14 as of 11:04 a.m. ET. It marked the first time since Aug. 12 the stock traded under its offer price.
Another lockup tranche hits the float
Around 319 million shares held by early employees and investors became eligible to trade Thursday, the Day 70 tranche in a staggered lockup that will release about 88% of SpaceX's 13 billion shares through 2027. MarketWatch put the same tranche at roughly 7% of the stock owned by early investors and employees.
A 1.3 billion-share tranche is set to unlock around SpaceX's third-quarter earnings in early November, followed by the 180-day expiry in December. CEO Elon Musk's 6.42 billion shares stay locked until June 2027.
Stock absorbed a bigger unlock earlier this month
The stock withstood a larger test on Aug. 6, when up to 911.5 million shares became tradable and the stock rose 6%. MarketWatch reported that by the end of Aug. 7, the day after that unlock, SpaceX's stock had climbed 23%.
Since its public debut in June, SpaceX has traded as low as $104.83 a share and as high as $225.64. Analysts' average price target sits at $226.26, according to FactSet data.
Acquisition talk denied, Starship timeline slips
Reports also surfaced that SpaceX had been in talks to acquire Cognition, the AI company behind coding agent Devin, but both Cognition and Musk denied it. According to Musk: "What Scott says is accurate", referring to Cognition CEO Scott Wu's denial. The report followed SpaceX's closed $60 billion purchase of Cursor, another AI coding company.
Deutsche Bank's Edison Yu kept his $235 price target on the stock but raised his full-year EPS estimate by 11% and his revenue projection by 1% on the Cursor deal.
Thursday's drop may also be tied to a Musk post that lowered expectations for the next Starship test, saying SpaceX won't attempt to "catch" the vehicle for a few months, after previously saying the company could probably catch it by the end of August.
Sources: Yahoo Finance, MarketWatch
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