SpaceX Stock is Crashing & Tesla Investors Want Answers

**John Johnston** (0:00)
Hi, everyone, JJ here. Welcome back. Well, two main stories today. SpaceX IPO, the shares have dropped below that IPO price of 135 As I speak, that's happened. We can see right now, as I speak, after hours, it is dropped to 127 The IPO price 135 Went down 3%, another 3% after hours. And we'll see the reasons for that. It's basically more than 40% below that peak price, I think. If we just have a look at Tesla shares as well, below 400 But, you know, not doing too badly year to date still, or in the past year. Still up 22% in the past year. And that market cap are 1.23 trillion on Tesla and on SpaceX, 1.73 trillion. So even though it's dropped a lot, still massive market caps on these companies. Or are they? You know, it's up to you to decide. As the people decide, some people think that it's not high. Some people think that it's very high. So Tesla shareholders are begging Musk to explain missed goals. So this is leading up to the next earnings as well. I think people are getting pretty sick of Elon's predictions, even short-term predictions about what's going to happen, and it doesn't happen. We're going to get into that story among others as well. This one, short-sellers are having a field day betting against SpaceX as shares continue to slap. So yes, short-sellers getting in on that. I mean, you could say in hindsight, all these things are obvious in hindsight, right? That was pretty obvious that the shares would go down at some point, but very hard to time.
A lot of IPOs do go down from the initial price. I keep saying that Meta, I think it was like five months in, it was down 50 percent. There are so many examples of that. So the FOMO kicks in and IPOs are often when markets inflated, when the markets hyped, so they can get the maximum amount. The company can raise the maximum amount of money and insiders can cash out if they want to. There's lockout periods over time, the more shares get unlocked and insiders can cash out if they want to. Let's get into the story and then we'll talk about Tesla as well. Both things going on. I'm just catching up here. You know, life events have taken me over, but I have been keeping an eye on the news. By the way, if I don't post a video every day, I'm going to post some things in the YouTube, you know, post community section there. I'll try and do that. Maybe do some, I don't know, short videos. We'll see how it goes. I'll do what I can, but as I'll explain to members, it's difficult at the moment. So SpaceX shares dropped below the IPO price of 135 on Wednesday.
It's been volatile since Elon Musk's rocket maker, his historic IPO in June.
SpaceX quickly joined the NASDAQ 100 last week due to a rule change, especially for Elon. Investors in the NASDAQ 100 won't be too happy about what's happening to the stock right there. And you know, with that rule change, a lot of people weren't happy about it. Can't say I was happy about that happening. I mean, why the rule change just for Elon?
SpaceX's unwind comes ahead of the company's 13th Starship test flight. And on that, it didn't take off. It didn't take off.
Look at what happened there too. And that's what led to, I think, that, you know, that dip, or today's dip, but it has been going down.
Last month's offering was ushered in a potential hot streak for IPOs, with Anthropic and OpenAI, which was likely to delay on that one, based on what's happening with OpenAI. But that's another story I've been following, what I think is the AI bubble.
During the first month of trading, SpaceX's shares jumped to more than 225 a share and skyrocketed about 20% on its first full trading day. Yes, a lot of FOMO there was going on there.
And this too, your short sellers are having a field day. Let's have a look at that. SpaceX bears a smelling blood in the water as the stock languishes below its IPO price. Short sellers are going all in against the company, hoping to make a killing off Elon Musk's faltering pull on investors. 185 million SpaceX shares are now sold short, which is nearly 29% of its publicly tradable shares and it was around only 5% three weeks ago. So yes, that's the way the market works. Short selling kind of balances out any excesses. And let's just see what Ed from ProfitGMarket says here about this. This title says SpaceX is down 40%.