Retail investors who propped up SpaceX through its post-IPO slump turned net sellers for the first time since the company's June debut.
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SpaceX retail investors turn net sellers, offloading $4.5 million
Retail investors who propped up SpaceX through its post-IPO slump turned net sellers for the first time since the company's June debut.
Retail investors sold a net $4.5 million of SpaceX (NASDAQ: SPCX) shares on Aug. 7, the first net outflow since the June 12 IPO, Vanda Research data shows.
"A shift from persistent net buying to selling is rarely about one catalyst, it is usually a mix of profit-taking, position fatigue and investors reassessing the risk-reward," Sam North, market analyst at eToro, said. "Friday is particularly interesting because retail turned net sellers while the shares were rebounding strongly and trading back around the IPO price."
The reversal came as the stock rallied 15.8% on Friday, closing at $138.74 on Aug. 10 — its first close above the $135 IPO price since mid-July. Net retail purchases peaked at $144.6 million on June 16, making Friday's outflow modest by comparison. The stock had fallen as much as 48% from its June peak of $225.64 to an intraday low of $104 in early August.
The flow reversal follows the first lockup expiration on Aug. 6, which freed roughly 911.5 million insider shares and more than doubled the available float to 1.55 billion. Additional lockup tranches are scheduled through Dec. 8, keeping supply dynamics in focus as analysts debate whether SpaceX's roughly 85-times-revenue valuation justifies its aggressive AI spending.
Earnings beat masks AI spending concerns
SpaceX's first earnings report as a public company supported the rebound. Second-quarter revenue surged 92% year-over-year to $7.81 billion, beating estimates of about $6.9 billion, while its net loss narrowed to $541 million and adjusted EBITDA rose to approximately $3.5 billion. Starlink reached 12 million subscribers, and CFO Bret Johnsen said the company is on pace to reach $100 billion in annualized recurring revenue by year-end.
However, AI-related capital expenditure surged to $15.83 billion in the quarter, pushing total capex to $18.4 billion. That spending spooked investors focused on near-term cash flow, even as the operating loss narrowed to $143 million from $970 million a year earlier. Elon Musk defended the spending on the earnings call, saying the company is building AI compute capacity at scale faster than anyone else.
Wall Street stays bullish despite valuation debate
Analysts remain largely bullish. Argus Research upgraded SpaceX to Buy with a $160 price target, citing "rapid payback" on AI infrastructure investments. Citigroup reiterated a Buy rating with a $200 target, and Raymond James maintained a Strong Buy, pointing to progress on Starship Flight 13.
Of 31 analysts tracked by TipRanks, 24 rate the stock a Buy, five a Hold, and two a Sell. The average price target stands at approximately $229.54, implying roughly 72% upside from current levels. However, targets range from a Street-low $75 to a Street-high $800, reflecting deep uncertainty about how to value a company spanning rockets, satellites, broadband internet, and AI.
Hedge fund veteran Whitney Tilson has warned against bottom-fishing, citing a "92 times trailing revenues" multiple he considers obscenely high for a nearly $2 trillion company. Kevin O'Leary, who sat out the IPO, said he is eyeing an entry point in the $100 to $110 range.
The stock remains a retail favorite despite the selling. SpaceX was the sixth most-discussed ticker on Stocktwits and the second most-mentioned stock on Reddit's r/WallStreetBets over the past week, according to sentiment aggregator SwaggyStocks. The company allocated at least 30% of debut shares to retail buyers, far exceeding the typical 5% to 10% reserved for that investor class, and the IPO reportedly drew over $70 billion in retail orders.
This article is for informational purposes only and does not constitute investment advice.
