SpaceX's blistering start still faces key tests that will determine the stock's true value

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Space X's blistering start still faces key tests that will determine the stock's true value Published Tue, Jun 16 20264:24 PM EDTUpdated 14 Min Ago Zev Fima@zevfima The Space X initial public offering was, by all accounts, a major success , and it has stayed red hot out of the gate. On Tuesday, its third day of trading, the stock peaked over $225 a share, before closing well off the highs at $201.68. For much of the day, Elon Musk's rocket-and-AI company had a market capitalization larger than Amazon , which is worth $2.65 trillion. They finished the day roughly even. The question to ask now: Has the IPO and early trading revealed the true demand for SpaceX stock, or are we still in the honeymoon period, when it cannot be overvalued and do no wrong, before reality starts to settle in? That's not to say anything about the company itself; only a fool would bet against Musk given his track record at Tesla . What SpaceX has managed to achieve since its founding over two decades ago is nothing short of legendary. The team is literally launching rockets and working on a fully reusable one, dubbed Starship, that could change the economics of the space industry. The company is placing satellites into low Earth orbit to deliver internet to the masses via its Starlink service. And, with its February acquisition of Musk's xAI , the owner of social media site X and the Grok chatbot, SpaceX is also competing with the best AI companies in the world, while it develops plans to build data centers in space. It also announced a $60 billion deal for AI coding startup Cursor on Tuesday. However, just because a company is revolutionary does not mean that it is being properly valued, and therein lies the issue with SpaceX stock. We don't actually know what this company is worth, and we more than likely won't know that answer for several weeks to many months. As compelling as Musk's five-to-10-year vision may be, timelines do matter. And, when it comes to an unproven technology like orbital data centers, timelines are not exactly certain. As it stands now, SpaceX is a company that makes very little money, requires a ton of cash to achieve its goals, and has issued total addressable market projections in the many trillions of dollars that some might call optimistic. SPCX mountain 2026-06-12 SpaceX performance since its June 12 debut The real issue is the lack of price discovery. While SpaceX stock has now been public for a few days, to say we're seeing authentic price discovery is, well, a stretch. For starters, before the initial public offering, the company named its own price, at $135 per share, opting to essentially forgo the price discovery process we usually get with an IPO, during which bankers set a price range based on the signals and feedback they receive from investors on the buy-side. Then there are the changes to index-inclusion rules made by Nasdaq and FTSE Russell, which will allow SpaceX to enter their indexes at an accelerated pace compared with IPOs of yesteryear. The Nasdaq changed a few of its requirements that will make it easier for massive tech companies to join the popular Nasdaq 100 index shortly after their public debuts. This benefits not just SpaceX, but also potentially OpenAI and Anthropic, which are planning blockbuster IPOs of their own. Among the changes: the elimination of a minimum-float requirement, which previously dictated that at least 10% of the company's stock, or "float," must be freely traded to qualify for index inclusion. In its place, the Nasdaq adopted a calculation system that limits the weighting of low-float stocks — a designation that applies to SpaceX, which sold only roughly 5% of the company in the IPO. To be sure, the size of its float will increase over time as lock-up periods expire (lock-ups prevent insiders and early investors from selling stock for a given period of time, and SpaceX is using an unconventional lock-up schedule ). Arguably, Nasdaq's most relevant change is to the so-called seasoning window for vetting new issues. Companies used to require up to a year of seasoning. But, SpaceX will only be seasoned for 15 days, making it eligible to join the Nasdaq 100 after just three trading weeks. For the FTSE Russell — which oversees the Russell 3000, 2000, and 1000 indexes, among others — inclusion eligibility now comes after just five trading days, instead of waiting for the next quarterly reconstitution. FTSE Russell also amended its 5% minimum free float requirement. The general argument in favor of the fast-track changes is that the indexes are supposed to reflect the broader stock market universe. The providers essentially argue they will fail to live up to that aim if they leave out massive companies that are now public. This is a predicament created, in large part, by st