SpaceX Is Down 19% From Its IPO Price. Tesla's History Suggests This May Happen Next
Is the space stock finally a buy?
Overview
Space Exploration Technologies (NASDAQ: SPCX) made history in June when it completed the largest IPO in history. It's been a wild ride for the space company since then. It opened at $150, meaningfully up from its IPO price of $135, and rose to as high as $225 in the following weeks. However, the stock has been mostly southbound recently, and at $109 as of writing, it is down 19% from its IPO price. Where will the stock go from here? Perhaps we can get a clue by looking at Tesla's (NASDAQ: TSLA) first year on the market. The other publicly traded corporation headed by Elon Musk bears some similarities to SpaceX. Let's dig in.
Image source: The Motley Fool.
SpaceX took on the challenge of revolutionizing space travel. It used to be extremely difficult and expensive due to the use of disposable rockets. The company pioneered reusable rockets and helped significantly reduce launch costs. Now, it is the largest player in the field and continues to innovate. SpaceX is also deeply vertically integrated, which helps the company control costs. Tesla similarly moved the electric vehicle (EV) market forward through its vertically integrated approach, innovative battery technology, and EVs that could perform just as well as gas-powered cars. Tesla went public on June 29, 2010, and about two months into its life as a publicly traded company, the stock had declined by 18%.
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Originally published at www.fool.com.