SpaceX drops over 10%! Falls for the third consecutive trading day after announcing bond issuance

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SpaceX announced its first issuance of investment-grade bonds, after which its stock price fell for three consecutive trading days, prompting the market to re-evaluate SpaceX's financing scale and valuation sustainability.

In early U.S. trading on Monday, SpaceX shares fell by more than 10%. Previously, the stock had already dropped over 8% cumulatively from last Wednesday to Thursday. Despite the continued pressure, as of last Thursday's close, the stock still remained about 37% higher than its IPO price of $135, with a market capitalization around $2.4 trillion (U.S. markets were closed last Friday).

According to Bloomberg, SpaceX is seeking to raise at least $20 billion through its first bond issuance, as part of an expectedly large overall borrowing plan, with the funds to be used to support its expansion into the artificial intelligence sector. In February this year, SpaceX completed its acquisition of Musk's xAI, officially incorporating AI into its core strategic map.

This news prompted some investors to re-examine the logic behind SpaceX's valuation. Combined with the sharp volatility caused by low liquidity at the IPO stage, market sentiment has clearly turned cautious.

Large First Bond Issuance, AI Expansion Drives Financing Needs

This bond issuance marks SpaceX's first entry into the investment-grade debt market, with a target fundraising amount of at least $20 billion. This move represents a significant shift in SpaceX’s capital structure strategy.

SpaceX’s bet on AI links its listing outlook with the anticipated IPOs of rivals Anthropic PBC and OpenAI.

Both companies plan to go public as early as this year, with expected valuations of around $1 trillion. The market is closely watching SpaceX’s IPO performance, viewing it as an important reference point for valuing similar high-growth AI concept companies.

Retail Participation Hits Record High, Low Float Amplifies Price Volatility

SpaceX completed its record-breaking $75.5 billion IPO last week, with only 4.2% of total shares available for trading on the first day.

The combination of low float and strong retail investor enthusiasm led to dramatic price volatility in the initial phase after listing—a feature not uncommon in recent IPOs.

According to Vanda Research data, retail investors net bought $405 million of SpaceX shares in the first five trading days after its IPO, setting a recent record for IPO retail participation.

Data shows that retail net purchases of SpaceX last week even exceeded the combined net retail purchases for each of the “Magnificent Seven” stocks during the same period.

Analysts Assign ‘Hold’ Rating, View Valuation as Fully Priced In

KeyBanc Capital Markets released the first research report equivalent to a "Hold" rating, with analyst Michael Leshock’s team rating the stock as "Sector Weight."

Leshock wrote in the report that SpaceX is expected to continue leading the space launch and related verticals, but most of its long-term value is already captured in the current share price.

"The company has a clear path for disruptive growth, but we believe this is already reflected in the current valuation, and the risk-reward now appears balanced."

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