SpaceX (SPCX) is about to face its biggest test since going public: its first earnings report. And investors are already jittery. The stock slipped about 2% in Monday's premarket session as traders positioned ahead of the company's debut quarterly results, due out after the closing bell on Aug. 4.
Meanwhile, the broader market was calm. Nasdaq futures rose 0.18%, and S&P 500 futures gained 0.49%. But all eyes are on SpaceX, which has seen its shares tumble about 20% since its June 12 IPO, a drop that briefly made Elon Musk the world's first trillionaire before the stock cooled off.
Jefferies Executive Pushes Back On Governance Concerns
Not everyone is worried about the stock's slide. Jefferies analyst Aniket Shah says investors are taking an overly rigid view of governance by focusing on Elon Musk's control over SpaceX. Shah argues that those who avoid the stock because Musk holds more than 80% of voting rights and serves as CEO, CTO, and chairman might miss out on potential long-term gains, as Bloomberg reported on Sunday.
But not everyone is convinced. Some institutional investors have criticized SpaceX's structure, arguing that Musk's control creates risks for ordinary shareholders. Nell Minow, co-founder and chair of ValueEdge Advisors LLC, told Bloomberg in June that the SpaceX IPO "extinguishes shareholder rights entirely, all but eliminating the right to bring a lawsuit for failure to meet fiduciary standards, cutting off access to books and records."
New York City Comptroller Mark Levine also criticized Musk's control before the IPO, saying, "There's no precedent for this."
Earnings In Focus
So what should investors watch when SpaceX reports? Reuters noted that the focus will likely be on AI spending and profitability at the company's Starlink satellite communications business. That's the unit that could drive future growth, but it also requires heavy investment. The broader tech selloff that pushed the Nasdaq-100 into correction territory hasn't helped, either.
SpaceX Analyst Outlook
Wall Street remains bullish, with a Buy rating and an average price target of $229.96 across 35 analysts. The range is wide, though: from a low of $115.00 to a high of $800.00. Recent analyst moves include:
- Macquarie: Outperform (Maintains Forecast to $250.00) (Aug. 3)
- Macquarie: Outperform (Maintains Forecast to $250.00) (July 31)
- HSBC: Initiated with Hold (Forecast $115.00) (July 24)
That HSBC Hold rating is a bit of an outlier, but it shows that not everyone is drinking the Kool-Aid.
Top ETF Exposure
SpaceX's weight in several popular ETFs is worth noting, because it means fund flows could move the stock. Here are the top funds with significant exposure:
- Defiance US 100 Tech Ex Software ETF (XIGV): 3.79% Weight
- ARK Innovation ETF (ARKK): 4.66% Weight
- ARK Autonomous Technology & Robotics ETF (ARKQ): 5.93% Weight
Significance: Because SPCX carries significant weight in these funds, any significant inflows or outflows for these ETFs will likely force automatic buying or selling of the stock.
SpaceX Price Action
SPCX Stock Price Activity: SpaceX shares were down 1.33% at $106.93 during premarket trading on Monday, according to market data.
So, what's the takeaway? SpaceX is a unique beast: a company with massive ambition, a founder with unprecedented control, and a stock that's already seen some volatility. The earnings report will give investors their first real look at the financials, and it could set the tone for the stock's next move. Whether you're a believer in Musk's vision or a skeptic worried about governance, this is a moment worth watching.
