SpaceX experienced a decline in its stock price in the days following its Initial Public Offering (IPO) on June 12, which reportedly made Elon Musk a trillionaire. The dip occurred after the company announced its acquisition of Cursor, an AI coding agent developed by startup Anysphere.
Acquisition and Initial Stock Movement
The IPO’s initial share price was set at $135. On the day of the IPO, the stock climbed to over $170, according to Mashable. By Tuesday, June 16, the price had reached a high exceeding $225, as reported by Forbes. However, some of these gains were relinquished by Wednesday.
The acquisition of Anysphere, the company behind Cursor, for $60 billion was announced on Tuesday. The following day, SpaceX’s stock price fell by five percent, a decrease reported by CNBC. This downward trend continued on Thursday, with an additional 3.75 percent drop.
As of the time of this writing on June 19, the market is closed. SpaceX’s current share price stands at $185. While the stock has seen a slight decrease on this day, it remains significantly above its IPO price.
Divergent Analyst Outlooks
Investor research firm Morningstar has expressed concerns about SpaceX’s valuation, stating that the company is “wildly overvalued.” Morningstar estimates the fair value of SpaceX shares at $62, with a best-case scenario placing the price at $169 per share. This best-case valuation is still lower than the current trading price but higher than the IPO price.
Conversely, investment bank Oppenheimer and Co. has raised its projection for SpaceX stock. Following the acquisition announcement, Oppenheimer increased its outlook from $190 to $250. Analyst Timothy Horan attributed this positive outlook to SpaceX’s control over “every layer of the AI stack, giving it cost and quality advantages,” with Cursor identified as a crucial element of this strategy.
The future trajectory of SpaceX’s stock price remains uncertain. The article notes that unless the stock falls below $138, Elon Musk is expected to retain his trillionaire status.
Norman Pearlstine is the Chief Editor of News Raise and focuses on Business news. His responsibility is to oversee the editorial content including business, commodities, personal investments and the stock market.
