The biggest stock market stories often begin the same way: enormous excitement, headlines about record-breaking demand, and a stock price that climbs the moment trading begins. SpaceX checked every one of those boxes when it debuted on the Nasdaq on June 12.
Shares were priced at $135, opened at $150, and finished their first trading day at $160.95, a gain of 19%. The move pushed the company’s market value above $2.1 trillion and instantly made it one of the world’s most valuable public companies. Yet its shares have fallen on each of the past three trading days. History suggests investors may want to separate the business from the stock before rushing in.
A Record-Breaking IPO Meets Record-Breaking Expectations
SpaceX’s initial public offering was unlike any before it. The company raised over $87 billion, including “greenshoe” options, at a $1.77 trillion valuation, making it the largest IPO ever completed. Demand reportedly exceeded available shares by roughly four times, helping fuel the stock’s first-day rise.
The enthusiasm is easy to understand. According to the company’s SEC registration statement, SpaceX operates three major businesses:
- Starlink satellite internet
- Space launch services
- Artificial intelligence operations acquired through xAI
Starlink generated $11.4 billion in revenue during 2025 and produced roughly $4.4 billion in operating income, making it the company’s primary profit engine. Subscriber counts climbed from 2.3 million in 2023 to more than 10 million by early 2026.
Meanwhile, SpaceX says its combined markets could represent a $28.5 trillion total addressable opportunity, with AI accounting for the majority of that figure. In fact, SpaceX now identifies itself as an AI company.
Those are powerful growth narratives. The problem is that investors already appear to be paying for much of that future growth today.
History Isn’t Kind to Mega-IPOs
Here is what happened to some of the largest IPOs in history.
| Company | IPO Year | IPO Valuation | Return One Year After IPO |
| Saudi Aramco | 2019 | $1.7 trillion | -11% |
| Meta Platforms (NASDAQ:META) (Facebook) | 2012 | $104 billion | -30% |
| Alibaba (NYSE:BABA) | 2014 | $168 billion | -27% |
| Rivian Automotive (NASDAQ:RIVN) | 2021 | $77 billion | -82% |
| Uber Technologies (NYSE:UBER) | 2019 | $82 billion | -18% |
The pattern is difficult to ignore. The larger and more anticipated the IPO, the harder it becomes to exceed expectations. Investors often bid shares up aggressively before fundamentals have time to catch up.
Research finds that the largest companies by market capitalization have historically underperformed broader indexes over long periods. That’s largely because expectations become almost impossible to satisfy.
| IPO Size | Number of IPOs | Median 1-Year Return |
| Over $50 billion | 7 | -31.9% |
| $10 billion to $50 billion | 25 | -17.4% |
| $2 billion to $10 billion | 182 | 12.3% |
| $500 million to $2 billion | 221 | 20.8% |
| Under $500 million | 191 | 7.7% |
Source: FactSet, V22 Research
Valuation Leaves Little Margin for Error
Granted, SpaceX is not Rivian, Uber, or Facebook. The company dominates commercial launches and has built a highly profitable satellite internet business. Those advantages are real.
That said, SpaceX also reported a net loss of roughly $4.9 billion in 2025 after incorporating xAI. The company lost another $4.3 billion during the first quarter of 2026 as AI investments accelerated.
At roughly $2.4 trillion, investors are paying more than 100 times trailing revenue. That’s a valuation that assumes years of near-flawless execution across rockets, satellites, and artificial intelligence.
There is another factor worth watching: insider selling. SpaceX structured its lockup agreement so portions of insider holdings can become available much sooner than the traditional 180-day restriction. Additional share supply could create pressure on the stock later this year.
Key Takeaway
In short, SpaceX may become one of the most important companies of the next decade. Its leadership in launch services, satellite communications, and AI gives it opportunities few businesses can match.
But great companies do not always make great investments at every price. History shows that many of the market’s largest IPOs delivered disappointing returns after the initial excitement faded. With SpaceX already valued above $2 trillion and trading at triple-digit revenue multiples, investors may find a better entry point by letting the post-IPO enthusiasm settle first.
Ultimately, patient investors often make more money buying great companies after the crowd stops celebrating than while the confetti is still falling.
