SpaceX SPCX shares jumped more than 6% on Tuesday, snapping a seven-session losing streak after Macquarie reiterated its bullish stance on the stock, saying the recent correction offers investors an attractive entry point into what it describes as a long-term infrastructure and artificial intelligence leader.
The rally lifted the stock to around $127, although it remains below its $135 initial public offering price after a gradual post-listing decline.
Macquarie said the recent weakness has created a disconnect between the company’s market valuation and its long-term growth prospects, particularly in AI.
Buying opportunity after sharp correction
SpaceX shares have been under pressure since their record IPO on June 12 and remain more than 20% below their debut closing price despite Tuesday’s rebound.
The stock also suffered a setback last week after the company’s 13th Starship test flight was aborted less than a second before liftoff because several engines failed to ignite.
Macquarie analysts, led by Paul Golding, believe those near-term issues have not altered the company’s long-term investment case.
Reaffirming an Outperform rating and a 12-month price target of $250, the brokerage said investors continue to underestimate SpaceX’s artificial intelligence opportunity in addition to its core aerospace business.
“We see significant upside from AI optionality; achieving only a fraction of terminal compute ambitions could justify valuation above current levels,” the analysts wrote.
According to Macquarie, the recent selloff presents a rare opportunity to buy what it describes as a category-defining infrastructure platform at a significant discount to its intrinsic value.
Earnings and lock-up in focus
Attention is now turning to Aug. 4, when SpaceX is scheduled to report quarterly earnings for the first time as a publicly traded company.
The earnings release will also trigger the first phase of the company’s staggered IPO lock-up expiration.
Unlike the standard six-month lock-up period used in most listings, SpaceX adopted a phased structure intended to reduce the risk of heavy insider selling.
Following the earnings release, insiders will be permitted to sell up to 20% of their eligible locked-up holdings, representing as many as 911.5 million shares.
An additional 10% of locked-up shares could become eligible for sale if the stock trades at least 30% above its IPO price for five of the ten trading sessions leading up to the earnings report.
The approaching lock-up has become another focal point for investors after a sustained decline in the share price.
Short sellers increase bets
The recent weakness has also attracted bearish investors.
Short interest has climbed to roughly one-third of SpaceX’s public float in recent weeks as traders positioned for further downside.
Because only a limited portion of shares is available for trading before the lock-up expires, increased short selling has amplified volatility.
Chief Executive Elon Musk dismissed those bearish bets in a post on X on Monday.
“The survival probability of firms who maintain a significant short position in SpaceX over time is very low,” Musk wrote.
Valuation debate continues
While Macquarie believes the recent correction has created an attractive buying opportunity, not all analysts agree.
Former hedge fund manager Whitney Tilson argued last week that the stock remains expensive despite the sharp decline.
“Don’t even think about bottom-fishing this one, as it still trades at 92 times trailing revenues,” Tilson wrote.
“That means it’s still nearly 10 times overvalued, given that I think a generous multiple for the stock would be 10 times revenues.”
The contrasting views highlight the debate surrounding SpaceX following its blockbuster IPO, with bulls focusing on its long-term AI and space ambitions while skeptics argue the valuation still leaves little room for execution missteps.
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