Key Highlights

  • SpaceX shares fell close to 6% from Tuesday's close of $201.80, marking the steepest single-session decline since the company's IPO listing, as profit-taking accelerated following an extraordinary post-listing surge.
  • CFRA analyst Keith Snyder maintained a Sell rating on SpaceX with a price target of $115, while prominent commentators including Jim Cramer and Michael Burry flagged the stock's revenue multiple of approximately 110 times as disconnected from its underlying cash generation capacity.
  • SpaceX's $60 billion all-stock acquisition of AI coding tool Cursor and a nascent options market have so far sustained speculative interest in the stock despite the valuation warnings from institutional and sell-side participants.

Space Exploration Technologies Corp., commonly known as SpaceX, declined close to 6% on Wednesday, pulling back sharply from its prior close of $201.80 as profit-taking intensified following a meteoric post-IPO surge that has drawn comparisons to the meme-stock episodes of recent years.

The SpaceX stock decline arrives against a backdrop of growing alarm among prominent market commentators and institutional analysts about the gap between the company's share price and its fundamental valuation anchor. CFRA's Keith Snyder maintained a Sell rating with a price target of $115 — representing a more than 40% discount to Tuesday's closing price — citing a revenue multiple of approximately 110 times that has historically been associated with early-stage software companies at peak cycle valuations rather than capital-intensive aerospace manufacturers.

Jim Cramer and noted short-seller Michael Burry have both issued public warnings about the SpaceX valuation, flagging the concentration of retail ownership and momentum-driven buying as risk factors that could amplify any reversal. Retail dominance in the shareholder base, combined with a nascent options market that has only recently developed around the stock, creates conditions where sentiment shifts can produce outsized price moves in both directions.

Despite the selloff, the bull case for SpaceX stock retains structural elements that have kept institutional interest alive. The company's $60 billion all-stock acquisition of Cursor, an AI-powered coding assistant, represents a significant bet on AI software integration within SpaceX's engineering operations — a move that some investors interpret as a revenue diversification strategy beyond the core launch and satellite internet businesses.

The broader market context added pressure. The Federal Reserve's rate decision under new Chair Kevin Warsh and a sector rotation away from high-momentum names — partly triggered by the U.S.-Iran peace deal improving risk appetite for more fundamental plays — weighed on speculative growth stocks. Investors moved capital from momentum names toward hardware and infrastructure names with clearer near-term earnings visibility.

For investors considering the SpaceX investment case, the core tension is clear: the company operates critical infrastructure in both launch services and satellite internet connectivity, with Starlink's subscriber base growing rapidly. But at a triple-digit revenue multiple, any disappointment in the pace of cash flow generation could trigger a significant valuation reset.

The development of an options market around SpaceX shares adds a new dimension. As derivatives liquidity deepens, institutional hedgers and speculative traders will have more tools to express views on the stock — which could either dampen volatility over time or create gamma-driven amplification of short-term moves.

Disclaimer: This article is for informational purposes only and does not constitute financial advice. Past performance is not indicative of future results. Investors should conduct their own research before making investment decisions.