SpaceX (SPCX) Is Down 14.7% After Starship Abort and Rising Scrutiny of Its Lofty Valuation

 

SpaceX (SPCX) Is Down 14.7% After Starship Abort and Rising Scrutiny of Its Lofty Valuation

**The King of IPOs is now a broken IPO. Here's why the world's most hyped stock just erased all its post-IPO gains—and whether the selloff is a buying opportunity or a warning shot.**

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## The $225 Dream That Became a $125 Nightmare

Just over a month ago, SpaceX made history. The company raised **$85.7 billion** in the largest initial public offering ever, pricing shares at $135 and debuting on the Nasdaq to thunderous applause. The stock opened at $150, rocketed past $200, and hit an intraday peak of **$225.64** on June 16. Retail investors piled in. Elon Musk briefly crossed the trillionaire threshold. SpaceX's market value approached **$3 trillion**.

Today, that dream is a distant memory.

On Friday, July 18, SpaceX shares plunged to **$126**, falling $10 below the IPO price and erasing all post-IPO gains. The 14.7% decline over five consecutive sessions has wiped out more than **$1 trillion** in market capitalization from the post-IPO peak. The stock has now shed roughly 45% from its all-time high.

The catalyst? A last-second abort of the 13th Starship test flight. The deeper problem? A valuation that many investors now believe was priced for perfection—and a company that is burning cash faster than it can launch rockets.

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## The Starship Abort: A Test That Never Got Off the Ground

### What Happened at Starbase

On the evening of July 16, 2026, at SpaceX's Starbase facility in Boca Chica, Texas, the countdown clock ticked toward zero for the 13th integrated Starship test flight. This was supposed to be a milestone mission: the first Starship launch since the company's record-breaking IPO, carrying **Starlink V3 satellites** for the first time, and a critical step toward proving the rocket's readiness for commercial missions.

The launch window opened. Telemetry lit up. Then, during the Super Heavy booster's engine startup sequence, **four of the 33 Raptor engines failed to ignite**. The automatic abort system did exactly what it was designed to do: it kept the rocket on the pad.

Elon Musk posted on X: "Some of the engines didn't start, triggering an automatic launch abort. Now offloading propellant. Next launch attempt hopefully in a few days". SpaceX later hoisted the Starship upper stage off the booster and plans to replace **two Raptor engines** before trying again.

### Why This One Matters More

This wasn't just another test failure in SpaceX's "test, fail, iterate" philosophy. It was the **first Starship launch attempt since the company went public**. And public markets have a very different tolerance for failure than engineers do.

As one analyst put it: "The company's 'test, fail, iterate' philosophy eventually produced the reusable Falcon 9. Public markets, however, have the patience of a TikTok scroll. Either the company delivers or the algorithm moves on".

The abort also triggered an **FAA investigation**—standard procedure for any launch anomaly—and delayed the first test of the upgraded Starship V3 rocket. For investors already nervous about SpaceX's execution risk, the timing couldn't have been worse.

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## The Valuation Scrutiny: Why the Market Is Saying "Not Cheap Enough"

### The Numbers That Are Scaring Investors

SpaceX's post-IPO slide isn't just about one scrubbed launch. It's about a valuation that many investors believe was simply too high to sustain.

The numbers are sobering:

| Metric | Value |

|--------|-------|

| **2025 Revenue** | $18.7 billion |

| **2025 Net Loss** | **-$4.9 billion** |

| **Q1 2026 Revenue** | <$4.7 billion |

| **Q1 2026 Net Loss** | **-$4.28 billion** |

| **Revenue Growth (2025)** | 33% (slowing from prior years) |

| **Current EV/Revenue Multiple** | ~45x |

The company is burning through cash at an alarming rate. In 2025, SpaceX reported a net loss of **$4.9 billion** on revenue of $18.7 billion. In the first quarter of 2026 alone, it lost another **$4.28 billion**. Revenue growth has slowed from 33% in 2025 to just 15.4% in Q1 2026.

Yet at current prices, SpaceX still trades at roughly **45 times forward sales**. Top investor James Foord argues that the valuation should be closer to **20 to 25 times sales** given moderating growth, ongoing cash burn, and potential share supply from insider lockup expirations. A 24x multiple on 2026 revenue would imply a market cap of about **$930 billion**, or roughly **$70 per share**.

### The Insider Lockup Overhang

Adding to the pressure is a looming **insider lockup expiration**. A Reddit post that drew over 1,300 upvotes on r/wallstreetbets summed up the anxiety: "SPCX first major unlock is bigger than the entire IPO float".

When insiders and early employees are finally allowed to sell their shares, the market could be flooded with supply—creating structural selling pressure that no amount of bullish analyst ratings can offset.

### The Competition Threat

The bull thesis for SpaceX has long rested on the idea that the company has a **years-long moat** in reusable launch technology. That thesis took a direct hit when Japan successfully landed a reusable rocket prototype. As one r/investing poster put it: "Had SPCX in my watchlist at $180 with 'competition is years away' as the core thesis, then Japan landed a rocket this weekend".

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## The Analyst Divide: $62 or $800?

Wall Street is deeply divided on what SpaceX is worth—and the gap between the bulls and bears is staggering.

### The Bears

- **Morningstar** pegs SPCX fair value at **$62** per share, implying the stock is still roughly twice as expensive as its intrinsic worth. The research firm values the company at about **$780 billion**.

- **Top investor James Foord** rates SPCX a **Sell**, arguing that even at current prices, the stock is "significantly overvalued". He says he "won't be touching SpaceX above $100" and could only justify "starting to nibble closer to $90".

### The Bulls

- **Deutsche Bank** has a **Buy** rating and a **$255** price target, implying substantial upside from current levels.

- **UBS** maintains a **Buy** rating with a **$210** target, suggesting more than 54% upside.

- **Raymond James** has the highest target on the Street: **$800**, implying 425% upside from current levels.

- **Needham** recently raised its target to **$250**, citing "increased confidence in execution".

- **Goldman Sachs** has a **$205** target.

- **Citi** initiated coverage with a **Buy** and a **$200** target.

The consensus among 32 analysts polled by S&P Global is a **"Buy"** rating with an average price target of **$240**—implying roughly 82% upside from current levels.

But the dispersion of targets—from $62 to $800—reflects the extraordinary uncertainty around SpaceX's future. As one analyst put it: "Lofty price targets remain educated opinions, not guarantees".

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## The Human Element: What This Means for Investors

### For the IPO Investor Who Bought at $200

If you bought SpaceX at the peak—$225, $200, or even $180—you're sitting on significant losses. The psychological toll of watching a "sure thing" lose 45% of its value in less than a month is real. The temptation to sell and cut losses is powerful.

But history offers some perspective. A Truist Wealth analysis of 30 major technology IPOs over the past 15 years found that they averaged a maximum decline of 55% in the first year of trading. SpaceX's 45% drop, while painful, is within historical norms for newly public tech stocks.

### For the Long-Term Believer

If you believe in Elon Musk's vision—a vertically integrated space, connectivity, and AI empire—this pullback might look like an opportunity. SpaceX's Starlink division continues to grow, with new inflight Wi-Fi rollouts and lunar-cargo agreements pointing to traction in the connectivity business. The AI business, while a "cash-burn story" for now, could eventually become a significant revenue driver.

But as one analyst noted, "the bigger questions remain the high valuation, limited cash runway, and the scale of spending required to reach the profitability analysts expect within three years".

### For the Skeptic

The bear case is straightforward: valuation and execution risk. The company is burning billions, revenue growth is slowing, competition is emerging, and insider lockup expirations loom. As top investor James Foord put it: "Accounting for some Musk-like premium, I could justify starting to nibble closer to $90, but I won't be touching SpaceX above $100".

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## What's Next: Starship Retry, Earnings, and Lockups

### The Next Launch Attempt

SpaceX has set a new target date of **Monday, July 20** for the next Starship launch attempt. Musk has said the company plans to replace two Raptor engines before trying again. A successful launch could provide a much-needed catalyst for the stock. A second failure could extend the selling.

### The First Quarterly Earnings

SpaceX is expected to release its first quarterly financial update as a public company on **August 6**. The report will provide the first detailed look at the company's financial performance since the IPO, including revenue growth, margins, and cash burn. The earnings release will also trigger the first wave of **lockup expirations**, allowing eligible pre-IPO holders to sell up to 20% of their shares.

### The Lockup Cliff

The lockup expirations represent the single biggest near-term risk. When insiders can finally sell, the supply of shares available for trading could increase dramatically—potentially overwhelming demand at current levels.

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## Frequently Asked Questions

### Q: Why did SpaceX stock drop 14.7%?

A: The drop was driven by a combination of factors: a last-second abort of the 13th Starship test flight due to engine ignition failures, growing scrutiny of the company's lofty valuation, looming insider lockup expirations, and heavy short interest.

### Q: What happened with the Starship test flight?

A: On July 16, 2026, SpaceX aborted the 13th Starship test flight seconds before liftoff when four of the 33 Raptor engines on the Super Heavy booster failed to ignite. The automatic abort system triggered a shutdown, and the rocket remained on the pad.

### Q: How far has SpaceX fallen from its peak?

A: SpaceX hit an intraday high of **$225.64** on June 16. The stock has fallen roughly **45%** from that peak, erasing more than **$1 trillion** in market value.

### Q: Is SpaceX profitable?

A: No. SpaceX reported a net loss of **$4.9 billion** in 2025 and another **$4.28 billion** loss in Q1 2026.

### Q: What do analysts say about SpaceX?

A: Wall Street is divided. The consensus is a "Buy" with an average price target of **$240**, implying 82% upside. However, targets range from Morningstar's **$62** to Raymond James' **$800**, reflecting significant uncertainty.

### Q: What are the biggest risks to SpaceX?

A: Key risks include: execution risk on Starship, ongoing cash burn and limited runway, looming insider lockup expirations that could flood the market with supply, slowing revenue growth, and emerging competition in reusable launch.

### Q: Is SpaceX a buy at these levels?

A: Opinions are divided. Bulls point to the company's dominant position in launch, Starlink, and AI infrastructure. Bears cite valuation, execution risk, and looming supply. As always, consult a financial advisor before making investment decisions.

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## Conclusion: The Rocket That Ran Out of Fuel—For Now

SpaceX's 45% drop from its peak is a reminder that even the most hyped IPOs are subject to the laws of gravity. The company that raised $85.7 billion in the largest IPO in history has seen more than $1 trillion in market value evaporate in less than a month. The stock is trading $10 below its IPO price, and the next few weeks will determine whether it holds that level or breaks further.

But SpaceX's slide is also a reminder of the extraordinary ambition—and risk—embedded in the company's valuation. This isn't a social media app or a consumer goods company. It's a company trying to build a base on the moon, a colony on Mars, the world's largest satellite network, and an AI infrastructure empire. The range of potential outcomes is unusually wide.

For investors, the question is whether the current price reflects the risks—or whether there's more downside ahead. As top investor James Foord put it: "I won't be touching SpaceX above $100". Morningstar sees fair value at $62. Deutsche Bank sees $255.

The next few weeks will be critical. Starship's retry will test the company's technology roadmap. The August earnings report will test its financial narrative. And the lockup expirations will test the market's appetite for more supply.

For now, SpaceX's stock is hovering well below its IPO price—a reminder that even the most ambitious companies must eventually prove their worth in the cold light of the public markets.

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## Disclaimer

**IMPORTANT:** This article is for informational and educational purposes only and does not constitute financial, investment, or trading advice. The information contained herein is based on publicly available sources and reflects the author's understanding as of the publication date. Market conditions, stock prices, and company performance are subject to rapid change. Past performance is not indicative of future results. You should consult with a qualified financial advisor before making any investment decisions. The views expressed in this article are those of the author and do not constitute a recommendation to buy or sell any security.

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*Published: July 18, 2026*f fcc

**Tags:** SpaceX, SPCX stock, Starship abort, SpaceX IPO, Elon Musk, stock market, space stocks, aerospace, Starlink, SpaceX valuation, IPO performance, tech stocks, NASA, launch abort, Raptor engine, SpaceX earnings, lockup expiration, SpaceX stock price, investment analysis, stock market news