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SpaceX stock erases all its gains and slides below IPO price in intraday trading

latimes.com

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Re: SpaceX stock erases all its gains and slides below IPO price in intraday trading

#31

Post by gleenn »

vv_ wrote: post #13
paoliniluis wrote: post #3

The IPO was meant for the VCs to cash out as all fundamentals were completely irrational, but seems like no one cares about cash flow and profitability anymore during QE times. Dumb money will keep being dumb I guess

If no one cared about cash flow and profitability wouldn't SpaceX stock go up instead of down?

I think one thing to point out is "everyone" in this context is probably the broader market, but the stock holdings aren't distributed uniformly. A few large investors could actually be sophisticated and unload a fortune and the rest of the shareholders could still largely still ignore fundamentals and suffer large losses. The broad market can be ignorant and the stock can (and is) be down, both things can be true.

Re: SpaceX stock erases all its gains and slides below IPO price in intraday trading

#33

Post by mothballed »

infecto wrote: post #24
mothballed wrote: post #19

Earlier quoted context omitted.

People cared after the IPO but initially in far less informed circles I constantly heard from lower sophisticated investors bragging about how they'd been allocated X shares like they were Pokemon trading cards they managed to snag. They weren't very sensitive to the price, only to brag to their friends they had snagged them. After the shiny wore off and no one cared about how cool they were, they sold them.

That is to be expected with any high profile IPO.

No this was anomalous for an IPO. People were limited to something like 10 shares that they had to pre-order like they were special order trading cards with an order cap as direct recipients of the initial shares.

Usually the public starts buying IPOs in open market operations on the secondary market, which removes some of the shiny and "limited" factor.

Re: SpaceX stock erases all its gains and slides below IPO price in intraday trading

#34

Post by infecto »

mothballed wrote: post #33
infecto wrote: post #24

Earlier quoted context omitted.

That is to be expected with any high profile IPO.

No this was anomalous for an IPO. People were limited to something like 10 shares that they had to pre-order like they were special order trading cards with an order cap as direct recipients of the initial shares. Usually the public starts buying IPOs in open market operations on the secondary market, which removes some of the shiny and "limited" factor.

I don’t think the allocation process changes the underlying point. The mechanics may have been unusual, but highly anticipated IPOs almost always attract buyers motivated by participation as much as valuation. Whether they got 10 shares through a special allocation or bought on the open market, there is usually a cohort that wants to say “I got in on the IPO.” Once the novelty fades, some of that demand naturally disappears. I’m not convinced that’s unique enough to call it anomalous.

Edit: why would this get flagged lol?

Re: SpaceX stock erases all its gains and slides below IPO price in intraday trading

#35

Post by SpicyLemonZest »

pfisherman wrote: post #4

My understanding is that an ideally priced IPO should not move much from the opening price in the near term. If it pops it means they left money on the table. If it drops, then I am not sure what the implication is exactly? Now I think SpaceX is massively overhyped, but is the share price returning to IPO opening not just a sign that the banks accurately estimated something?

All of the IPO banks have a public position that SpaceX is actually undervalued and should be at least $200. (Are they telling the truth? lol.)

Re: SpaceX stock erases all its gains and slides below IPO price in intraday trading

#37

Post by skywal_l »

paoliniluis wrote: post #3

The IPO was meant for the VCs to cash out as all fundamentals were completely irrational, but seems like no one cares about cash flow and profitability anymore during QE times. Dumb money will keep being dumb I guess

Is it possible that people who don't care about short term profitability but still want a strategic ownership of the company bought at a high price on IPO day and now that the day traders are in, speculation will readjust the price to short term values? The change of price just reflect the different buyer profiles.

SpaceX is a pretty important company not just for "the market" but also for many other things (see Russia/Ukraine war).

Fair warning: I know nothing about all this.

Re: SpaceX stock erases all its gains and slides below IPO price in intraday trading

#38

Post by petesergeant »

> closing at $135.27

ffs, wake me up when it's at least 10% below what it IPO'd for. The idiotic tulip mania that followed in the few days after it floated was noise, but as of today, it seems the IPO price was pretty much right. However, endless headlines about the price crashing etc.

From a fundamentals perspective, it's an insane price, obviously. But the narrative that it's all coming crashing down is obviously not correct (today).

Re: SpaceX stock erases all its gains and slides below IPO price in intraday trading

#39

Post by mr_toad »

sigmoid10 wrote: post #27
paoliniluis wrote: post #3

The IPO was meant for the VCs to cash out as all fundamentals were completely irrational, but seems like no one cares about cash flow and profitability anymore during QE times. Dumb money will keep being dumb I guess

The IPO featured less than 5% of shares as free float. So the investors are still in pretty deep with their hands tied until lock-up restrictions expire. The IPO was more of a quick, public financing round for their AI branch than an exit for SpaceX VCs.

As those lock-ups expire I only see the stock sliding further. Still, the very early investors will probably make bank, with the retail investors holding the bag.

Many of those early investors would have invested in a rocket company, I doubt many of them were overjoyed to be saddled with all the debts from an AI company and Twitter.

Re: SpaceX stock erases all its gains and slides below IPO price in intraday trading

#40

Post by Zigurd »

skywal_l wrote: post #37
paoliniluis wrote: post #3

The IPO was meant for the VCs to cash out as all fundamentals were completely irrational, but seems like no one cares about cash flow and profitability anymore during QE times. Dumb money will keep being dumb I guess

Is it possible that people who don't care about short term profitability but still want a strategic ownership of the company bought at a high price on IPO day and now that the day traders are in, speculation will readjust the price to short term values? The change of price just reflect the different buyer profiles. SpaceX is a pretty important company not just for "the market" but also for many other things (see Russ…

There are no "pretty important" companies with the relatively meager revenues SpaceX has got.
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