SpaceX (SPCX) shares plummeted 14.24% during Monday's intraday trading session, extending a recent sell-off that has followed the company's historic initial public offering earlier this month.
The sharp decline was driven by multiple factors. First, the company announced the commencement of its inaugural offering of senior unsecured notes, signaling it needs to raise more cash shortly after its record $75 billion IPO to fund its ambitious expansion into artificial intelligence infrastructure. Concurrently, KeyBanc Capital Markets initiated coverage of the stock with a neutral "Sector Weight" rating, noting that while SpaceX possesses significant disruptive growth avenues, this potential is already reflected in its current valuation. Furthermore, reports revealed that MSCI assigned SpaceX its lowest possible ESG rating of triple-C just ahead of the IPO, reflecting concerns over governance, shareholder rights, and board independence.
Analysts also pointed to a cooling of the initial post-IPO euphoria as investors reassess the company's capital-intensive business model and growth prospects. The broader technology sector faced pressure amid concerns over massive AI infrastructure spending, contributing to the downward move for SpaceX and other megacap tech stocks during the session.