The stock rises because it rises and falls because it falls.
In the months following the largest initial public offering in history, SpaceX shares have retreated sharply from their peak, erasing nearly a trillion dollars in market value and reminding investors — including many ordinary New Zealanders — that the story a company tells about its future and the price the market assigns to that story are not always the same thing. The pattern is an old one: a small public float, an audacious vision, and a polarizing founder combined to produce early pricing that reflected hope more than evidence. What follows such moments is rarely a straight line, and SpaceX is now tracing the familiar arc of euphoria giving way to recalibration.
- SpaceX shares have shed roughly a third of their peak value, wiping close to US$1 trillion in market capitalisation and costing Elon Musk his trillionaire status in a matter of months.
- New Zealand retail investors who piled in through platforms like Sharesies during the IPO frenzy now find themselves holding stock well below the prices many paid in secondary market trading.
- With only 5% of shares publicly traded, a small pool of optimistic early buyers was able to inflate the price dramatically — but as the shareholder base widened, more cautious voices began pulling valuations back toward earth.
- The stock behaves like a pure sentiment instrument: minor shifts in interest rate expectations or growth assumptions produce violent price swings because nearly all of SpaceX's value rests on cash flows that may not materialise for years.
- No near-term stabilising force is visible — S&P 500 inclusion is at least 12 months away, and the first quarterly earnings report, the next real information event, is still months ahead.
SpaceX shares have fallen from a post-IPO peak above US$200 to around US$135, erasing nearly US$1 trillion in market value and stripping Elon Musk of his trillionaire status. The collapse has left many New Zealand retail investors nursing losses in what analysts describe as a textbook case of IPO euphoria parting ways with business fundamentals.
When SpaceX priced its offering at US$135 per share in June 2026, it entered the market as one of Wall Street's ten largest companies, surpassing Tesla, Meta, and Walmart. Demand was intense. Sharesies reported strong interest and active secondary trading in the weeks that followed. The excitement seemed reasonable — this was the biggest IPO in history, backed by a company with genuine ambition.
But the structure of the offering contained the seeds of its own correction. Only about 5% of total shares were made available to the public, meaning a relatively small group of optimistic investors could exert outsized influence on early pricing. AUT finance professor Aaron Gilbert explains that as the shareholder base broadens and more cautious voices enter, initial enthusiasm tends to unwind. At US$200 per share, buyers were effectively wagering that Starship would become commercially viable, Starlink would dominate satellite internet, and newer ventures would generate substantial profits — all simultaneously, and in a less forgiving interest rate environment.
Forsyth Barr senior analyst Aaron Ibbotson calls SpaceX a "proper FOMO stock" — one that rises because it rises and falls because it falls, with limited grounding in current earnings. Kernel founder Dean Anderson notes that the IPO process itself generates suspense and urgency that often proves temporary; once the initial buying activity eased, prices began retreating.
Despite the pullback, SpaceX still trades at elevated multiples that leave little room for disappointment. The next meaningful moment will come with the company's first quarterly earnings reports, when analysts can begin assessing Starlink's trajectory and spending on AI infrastructure. Whether the IPO price ultimately proves a bargain or a warning will likely become clear over the next 12 to 18 months.
SpaceX shares have collapsed from their initial peak of more than US$200 to around US$135 in the months since the company's record-breaking IPO, erasing nearly US$1 trillion in market value and stripping founder Elon Musk of his trillionaire status. The plunge has caught many New Zealand retail investors in what market observers describe as a textbook case of IPO euphoria disconnecting sharply from business fundamentals.
When SpaceX priced 555 million shares at US$135 each in June 2026, the company entered the top 10 of Wall Street's largest corporations with a valuation just under US$1.8 trillion—surpassing Tesla, Meta, and Walmart. The offering generated intense demand. Sharesies, the investment platform used by many New Zealanders, reported very strong interest in the IPO and active secondary market trading in the weeks that followed. Co-chief executive Leighton Roberts said the platform was pleased with the allocation it secured for investors who applied. The excitement seemed justified: this was the biggest initial public offering in history, backed by a company with an audacious vision and a polarizing founder.
But the initial frenzy has given way to something closer to caution. Aaron Gilbert, a professor of finance at AUT, explains why this pattern is so common with companies like SpaceX. The company has an exciting narrative, genuine long-term potential, and a small publicly traded float—only about 5 percent of total shares. This combination means optimistic investors can exert outsized influence on early pricing. Over time, as the shareholder base broadens and more cautious voices enter the market, that initial enthusiasm tends to unwind. "Share prices ultimately reflect information and expectations about the future," Gilbert notes. At US$200 per share, investors were essentially betting that SpaceX would achieve multiple ambitious goals simultaneously: Starship becoming commercially viable, Starlink dominating global satellite internet, and newer ventures like floating AI data centers generating substantial profits. All of this had to happen while interest rates potentially rose and economic conditions became less favorable.
Because so much of SpaceX's value depends on cash flows years into the future, even modest shifts in growth expectations or interest rate assumptions can produce dramatic share price swings. Small pieces of news—positive or negative—trigger outsized movements as investors constantly reassess a business whose worth rests far more on what it might become than what it currently earns. Aaron Ibbotson, a senior equities analyst at Forsyth Barr, describes SpaceX as a "proper FOMO stock"—one that rises because it rises and falls because it falls, with limited connection to underlying business metrics. The broader AI hype cycle that lifted many stocks has also weakened, removing some of the tailwind that initially buoyed the offering.
Dean Anderson, founder of Kernel, points to a pattern familiar to anyone who has watched IPOs over decades. The process itself—the suspense, the buildup, the sales activity—generates excitement that often proves temporary. With SpaceX, the small amount of equity being raised relative to demand created a perception that missing out would be costly. Once that initial buying activity eased and investors completed their shopping, prices began retreating. The stock's inclusion in major indices happened quickly, but the S&P 500 will not add it for at least 12 months, meaning no fresh institutional buying support is imminent.
Even after the recent pullback, SpaceX does not trade at bargain valuations. Gilbert cautions that companies already priced at very high multiples—whether measured by price-to-sales or other metrics—leave little room for disappointment. Investors make money by buying businesses for less than they are ultimately worth, and SpaceX's current price still embeds enormous optimistic assumptions.
The next significant moment arrives when SpaceX releases its first quarterly earnings reports. Until then, no new information is available to investors. Analysts will scrutinize Starlink's progress, the pathway for the company's other ventures, and spending on AI infrastructure. Whether holding SpaceX from the IPO proves worthwhile or whether waiting would have been the better choice remains an open question—one that will likely be answered over the next 12 to 18 months as the company's actual performance either validates or undermines the expectations baked into its current price.
Citas Notables
At around $200 per share, investors needed a great deal of SpaceX's future potential to become reality—Starship to be commercially successful, Starlink to become the dominant global satellite internet platform, and newer ventures such as floating AI data centres to generate substantial profits.— Aaron Gilbert, AUT professor of finance
SpaceX is one of those proper FOMO stocks, and if there is no missing out, then the fear subsides. Proper momentum stock. It goes up because it goes up and then down because it goes down.— Aaron Ibbotson, Forsyth Barr senior equities analyst
La Conversación del Hearth Otra perspectiva de la historia
Why did SpaceX shares fall so dramatically after such a successful IPO?
The IPO itself created the conditions for the fall. With only 5 percent of shares publicly traded, optimistic investors had outsized influence on the opening price. Once the initial buying frenzy ended and a broader shareholder base formed, more cautious voices entered the market and prices adjusted downward.
But SpaceX is a real company with real technology and real ambitions. Shouldn't the price reflect that?
It does—but the price reflects expectations about a future that may be years away. At US$200 per share, investors needed Starship to work, Starlink to dominate, and new ventures to generate huge profits. That's a lot of things that have to go right simultaneously.
So is it a bad investment now at US$135?
Not necessarily bad, but not obviously cheap either. Even after the pullback, the valuation is still very high. The company hasn't yet proven it can deliver on those ambitious promises, and there's little room for disappointment built into the current price.
What happens next?
The real test comes when SpaceX reports quarterly earnings. Investors will want to see whether Starlink is growing as expected, what the company is spending on AI infrastructure, and whether the business is tracking toward the assumptions that justified the IPO price. Until then, the stock will likely remain volatile on sentiment rather than news.
Does this tell us anything about how New Zealanders should approach IPOs?
It's a reminder that excitement and fundamentals are different things. IPOs generate suspense and FOMO—fear of missing out. That can drive prices well above what the underlying business actually justifies. Patience often pays.