SpaceX Stock Rises as Insider Lockup Expires

SpaceX shares rose 2.5% to $110.92 in noon trading Thursday, even as many of the company's insiders were freed to sell their stock for the first time.

More than 900 million shares became newly available to buy or sell with Thursday's release, doubling what had been available previously. It was the first of several so-called lockup expirations that lift restrictions barring employees and other early holders from trading.

Investors had pushed the shares down sharply in recent days in anticipation of insider selling. On Wednesday, the stock suffered one of the biggest routs in its short history as a public company, dropping nearly 14%.

Morgan Stanley analyst Adam Jonas said the expiration of the lockup provisions was an opportunity for other investors to buy into the stock cheaply. He believes the shares could reach $300 by the middle of next year, nearly triple their current level. Morgan Stanley was one of the investment banks that earned large fees helping take SpaceX public.

Earlier this week, SpaceX reported a loss of $541 million, or 9 cents per share, for the three months through June — less than half what financial analysts had forecast. Revenue jumped to $7.8 billion, up more than 90% from the same period a year earlier.

The company also posted a large increase in spending on research and development and on infrastructure, particularly involving artificial intelligence, along with other major projects. Investors have grown increasingly nervous about heavy capital spending at technology companies, and those figures have triggered sell-offs across the sector.

Elon Musk sold SpaceX shares to the public for the first time in June in the biggest initial public offering ever. The shares jumped as high as $225, briefly making Musk a trillionaire.

The decline since then has wiped out hundreds of billions of dollars in market value. The stock is now trading below its initial offering price of $135.