SpaceX (SPCX) Stock Drops as Launch Delays and Short Sellers Weigh

TLDR

• SpaceX stock dropped around 2.5% to $115.26 Friday after another Starship test flight delay
• HSBC initiated coverage with a Hold rating and a $115 price target, bucking the bullish Wall Street trend
• The 13th Starship test flight has now been delayed twice — first for an engine issue, then for weather
• Short sellers have racked up an estimated $15.5 billion in paper profits since the June IPO
• SpaceX’s first earnings report is due August 4, with Starlink growth seen as the key metric to watch

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SpaceX stock slipped 2.5% to $115.26 on Friday morning, weighed down by back-to-back Starship launch delays and a surprise Hold rating from HSBC analyst Nicolas Cote-Colisson, who set a $115 price target on the stock.

Space Exploration Technologies Corp., SPCX

The stock is now down nearly 50% from its all-time high of $225.64 and down 12% from its June IPO price of $135.

The 13th Starship test flight has been scrubbed twice. The first attempt on July 17 was aborted after several Raptor engines on the Super Heavy booster failed to ignite. The second attempt on July 23 was called off due to weather conditions affecting visibility of the spacecraft’s heat shield.

SpaceX has since replaced multiple Raptor engines and completed additional ground testing. A new attempt was scheduled for Friday evening, watchable at spacex.com and on X.

In this test, the booster’s main objective is a successful launch, stage separation, boostback burn, and landing burn at an offshore point in the Gulf of America. The upper stage will attempt to deploy 20 Starlink V3 satellites and test an in-space engine relight before splashdown in the Indian Ocean.

HSBC Breaks From the Bull Pack

HSBC’s Hold is an outlier. Coming into Friday, 28 of 37 analysts — about 76% — rate SpaceX a Buy. The average price target sits around $237 per share. The typical Buy-rating ratio for S&P 500 stocks runs between 55% and 60%.

Cote-Colisson acknowledged SpaceX is impressive but urged investors to be “prudent.” He flagged that selling pressure could build as early investors’ lockup periods expire following the June IPO.

The Aug. 4 earnings report is the next major event. The analyst said SpaceX will need to show clear growth in its Starlink business to give the stock a lift.

Short Sellers Are Winning, For Now

Short sellers haven’t been shy. An estimated $15.5 billion in paper profits have accumulated since the IPO, with around 360 million SpaceX shares — roughly 56% of freely tradable stock — reportedly on loan to short sellers.

After two back-to-back gains of 19%-plus in the days following the IPO, SpaceX stock has dropped in 17 of the past 26 trading sessions. That includes a brutal seven-day losing streak that ended Tuesday, followed by a 6.7% drop on Wednesday.

Alphabet also disclosed a large SpaceX position this week, valuing its holdings at approximately $94.1 billion as of end of June — though the decline in SpaceX’s share price has reduced the current market value of that stake.

SpaceX’s Falcon 9 program continues at a steadier pace. The company launched 24 Starlink satellites from California on July 21, one day after a rare last-second abort.