Key Takeaways
- SPCX shares dropped 1% in pre-market hours Friday, reaching $151.46 and marking a 24% decline across six sessions following its June 12 market debut
- The share price momentarily fell under $150, matching the opening price from its first trading day — a threshold never breached at close
- Russell 1000 inclusion takes effect after Friday’s closing bell, with SPCX designated 90.4% growth-oriented and 9.6% value-oriented
- Index-tracking funds will likely purchase approximately $3 billion in SpaceX shares to maintain benchmark alignment, according to Jefferies analysis
- A July addition to the Nasdaq 100 is anticipated, compelling major investment vehicles like Invesco QQQ ETF to acquire positions
Shares of SpaceX (SPCX) declined 1% during Friday’s pre-market session to $151.46, momentarily touching the $150 threshold — matching its initial public offering opening price from June 12, though never finishing a session below this mark.
Space Exploration Technologies Corp, SPCX
This downturn continues a challenging period for the aerospace company. From its intraday peak of $225.64 reached on June 16, SPCX has tumbled approximately 24% through Thursday’s closing price of $153 across just six trading sessions.
The downdraft reflects broader investor retreat from richly valued technology and artificial intelligence stocks. SpaceX recorded a $4.9 billion loss in the previous fiscal year, while its current valuation stands at 107 times projected 2025 revenue. By contrast, Nvidia commands roughly 21 times its sales.
This valuation disparity has attracted considerable attention. The magnitude of the decline stripped CEO Elon Musk of his trillionaire designation.
The New York Times reports that OpenAI is reconsidering its IPO timeline in light of SpaceX’s challenging market reception, according to sources with knowledge of the situation.
Russell 1000 Entry May Generate Buying Pressure
Notwithstanding recent headwinds, Friday presents a possible positive development. SpaceX gains admission to the Russell 1000 index following today’s closing bell, part of FTSE Russell’s twice-yearly rebalancing process.
FTSE Russell modified its eligibility requirements earlier this year, allowing accelerated inclusion for major newly public companies. The aerospace firm enters with a 90.4% growth classification and 9.6% value designation, subject to reassessment in December.
This matters because index funds replicating Russell benchmarks — such as the iShares Russell 1000 ETF (IWB) — must hold constituent stocks. Jefferies projects these funds will acquire close to $3 billion in SPCX shares to align with index weightings.
This purchasing activity typically concentrates around the closing bell on reconstitution day, as portfolio managers seek to minimize tracking deviation. Options pricing suggests market participants expect approximately 3.6% movement in either direction by session end.
Nasdaq 100 and S&P 500 Considerations
SpaceX appears positioned for Nasdaq 100 inclusion during July. This would necessitate purchases by substantial funds including the Invesco QQQ ETF, creating additional index-driven demand.
S&P 500 membership remains unavailable presently. S&P Global maintained its profitability standards for large-cap IPOs, declining to accommodate SpaceX. Qualification requires positive earnings for both the most recent quarter and the trailing twelve-month period — standards SpaceX currently fails to meet.
SpaceX’s market capitalization approximates $2 trillion, placing it near Amazon’s valuation level. However, merely $100 billion represents publicly available shares, with remaining equity controlled by Musk, company insiders, and employee shareholders.
Tesla’s S&P 500 incorporation in 2020 produced a closing-hour rally that pushed shares up 6% on inclusion day.
