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SpaceX’s logo is visible on a building at the company’s South Texas facility in Cameron County, Texas, on July 22, 2026. (Photo by Reginald Mathalone\/NurPhoto via Getty Images)<\/p>\n
NurPhoto via Getty Images<\/p>\n
The share price for SpaceX (Space Exploration Technologies Corp.) on the IPO day\u2019s closing was $160.95. On June 16, a few days after the IPO, the price was $201.80. On Friday, July 24, just over a month later, shares closed at $115.07. That\u2019s a drop of 28.5% from the initial price. It also meant a loss of $1 trillion from the peak market capitalization of about $3 trillion, leaving $2 trillion.<\/p>\n
That\u2019s how Bloomberg got to the mid-July headline, \u201cSpaceX Slump Wipes Out $1 Trillion<\/a> in Market Value From Peak.\u201d It\u2019s the type of whiplash that shows how crazy Wall Street hype can get. The expectations, or maybe the wishful thinking, were all based on the magic that was supposed to happen. Morgan Stanley analysts recently estimated that if the shares dropped to $100, a short stroll, it would imply that investors valued the entire AI division at $0<\/a>, as Bloomberg reported.<\/p>\n (A reminder here to always remember that one expectation from an IPO is for early and major investors to make a killing<\/a> from selling some of their shares to retail investors, which may mean you, at soaring prices. Hype is almost always intentional.)<\/p>\n Going into the IPO, some like Brandon Lingle at the San Antonio Express-News said that SpaceX\u2019s biggest moneymaker<\/a> was Starlink, the satellite-based internet access system. A more accurate representation might have been that Starlink was not only the biggest moneymaker but the only profitable part of SpaceX.<\/p>\n Two aspects of company valuation estimations are at interplay here. One major factor in how investors calculate value is how well they think the company will do in the future. There are other parts to the valuation question: such aspects as assets, liquidity and cash flows, composition of management teams, competitive advantages, and intellectual property.<\/p>\n However, in various ways, all of them fit into understanding a company\u2019s future. That is why the forward price\/earnings ratio is a popular measure of corporate performance alongside trailing P\/E. If you pay a given price for a share and future performance suggests the company will be worth much more at some reasonable point, you could consider it a good value.<\/p>\n Estimating the future performance and value is challenging because so much is guesswork. There are tools like discounted cash flow analysis to help determine the worth of an investment based on future cash flows. Unfortunately, trying to determine cash flow in the future might be an exercise in expert insight analysis, but more often it\u2019s probably an attempt at augury.<\/p>\n You could argue that the exercise in pricing SpaceX shares was exactly this. The Starlink portion is profitable, though the business is criticized for various reasons<\/a> according to the site Starlink Insider, including growing congestion in heavily used areas, poor customer service (the FCC has received more than 900 complaints over the last five years<\/a>, says Fast Company), need for a clear view and cooperative conditions, and the growing resistance to launching ever more satellites. It does have 10.3 million customers across 164 countries, which represents a comparatively small niche player. For comparison, Verizon boasted 116 million wireless retail, 11 million broadband, and 2 million Fios video connections in 2025 for a total of 129 million. Revenue was $11.39 billion for 2025. <\/p>\n