SpaceX continued its downturn on Monday, marking three consecutive days of losses, following its historic IPO earlier this month.
Shares fell 16.4% on Monday, after a 3.6% drop Thursday, and a 5% drop on Wednesday. Shares are now only up 14% from its $135 IPO price. Just last week SpaceX topped Amazon and Microsoft to be the fourth-most-valuable company.
The company confirmed its first-ever bond sale on Monday, SpaceX said it “intends to use the net proceeds from the Notes offering to repay the outstanding borrowings under its bridge loan facility in full” and for other similar fees.
The bond issuance suggests SpaceX is converting the bridge financing tied to the xAI acquisition into permanent debt. By issuing these bonds, the company is effectively transferring its debt from bank lenders to investors.
Another variable to watch is the expiry of equity lock-up periods, which can put more downside pressure on the stock.
Apparently there is a 20% insider share unlock in early to mid-August. There’s also a 10% share unlock if the stock trades 30% higher than the IPO price, as well as 7% share unlocks around late-August and then again in mid-September.
22V Research strategist Jeff Jacobson suggests that insiders can potentially sell 44% of the company’s shares by early September, increasing the current float by 900%. With impending expiring lock-out periods, shareholders worry if the buy interest is enough to support the current 4.2% float.
