SpaceX investors are finally getting some reprieve after months of being whipsawed by volatility as the Elon Musk-led company’s stock breaks above the level it’s been stuck below since July.
Space Exploration Technologies Corp. shares have been trading above $160 all week, a level they closed at on July 6 but hadn’t returned to since. The stock has jumped 48% in just three months after hitting a low on Aug. 5. Shares extended those gains Friday, rising as much as 3.6% after SpaceX acquired a crucial batch of spectrum that will allow it to offer “complete phone coverage in America.”
It’s a stark reversal from the extremely volatile trading investors endured following SpaceX’s blockbuster initial public offering in June. The shares hit the market at $135, soared above $200 in their first few days of trading and then plunged to $108 by late July, erasing $1.2 trillion in market value. The rebound since August has added back more than $750 billion in value.
“This is a long play and there’s a little bit of aura and hidden-ness, you know, Elon Musk-ness in it, and I think that’s what it’s trading on,” Bloomberg Intelligence analyst George Ferguson said. “There’s a bunch of believers in this thing.”
The stock had been trading in a tight range since mid-August, as lockups banning early investors from selling their shares expired, boosting the total float, or shares available to trade, to about 33% of the company’s outstanding shares from roughly 7.5% in the IPO. Wall Street had been concerned that the expirations would trigger a wave of selling, but the steadiness in the stock price indicates that insiders aren’t unloading their stakes.