You bought SpaceX shares at the IPO price — and now you're losing money. Is it safe to buy the dip?

Retail investors who fought for shares at the $135 IPO price are down about 10% now. Those who bought four days later, at the June 16 peak of $225.64, are down around 40%. A 40% discount on the hottest company in the world may look like an obvious buy, but that instinct is exactly what needs examining.

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"Hype and quality are not the same thing," Matthew Fleissig, CEO of the wealth management firm Pathstone, warned in a recent MarketWatch column. The next two weeks will test which one SpaceX has been trading on.

SpaceX (NASDAQ:SPCX) is set to report its first earnings as a public company on Aug. 4 , and two trading days after that, hundreds of millions of insider shares will become eligible to sell for the first time. Short sellers already control close to a third of the stock's tradable float.

SpaceX priced its IPO at $135 a share on June 11, raising $85.7 billion in what became the largest public offering in history. Shares jumped to $160.95 on their first day of trading on June 12, then kept climbing. By June 16, the stock touched an intraday high of $225.64, pushing the company's valuation briefly past $2 trillion.

It's been mostly downhill since. Shares fell for seven straight sessions through July 20, sliding 21% in that stretch to close at $119. The stock finally caught a break Tuesday, climbing as much as 7% to $128 after Macquarie analysts stood by their outperform rating and called the selloff a buying opportunity. Shares lost some steam in intraday trading, however, and closed at $123.54.

Along the way, Meta passed SpaceX in market value — $1.64 trillion to $1.59 trillion.

The company's own missteps haven't helped. SpaceX scrubbed a Falcon 9 launch that was supposed to put 24 Starlink satellites in orbit, and pushed back its 13th Starship test after several engines failed to start — two of them had to be pulled and replaced. Growth is slowing too. SpaceX grew revenue 33% in 2025; in the first quarter of this year, that rate fell to 15%. And the company is still deep in the red — with a $4.9 billion net loss last year on $18.7 billion in revenue .

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Short interest in SpaceX keeps climbing . It stood at 5% to 7% of the tradable float a month ago. Last week it was 185 million shares, 29% of the float. Now it's near 206 million shares, or 32% — roughly $25 billion riding on the stock falling further, according to S3 Partners. The firm's head of research, Matthew Unterman, told CNBC, "We continue to see short sellers adding exposure ahead of several key upcoming catalysts." Shorts are deliberately positioning for Aug. 4 and the share unlocks behind it. That 32% is a level almost unheard of for a company this size; Apple's short interest hovers near 1% .

Musk isn't taking any of this quietly. Firms that keep betting against SpaceX, he wrote on X , have a "very low" chance of surviving — and he repeated his claim that, if goals are met, the company "will be worth more than Earth." His own fortune is riding on it. Forbes' Real-Time Billionaires Index put his net worth above $1 trillion on IPO day; by July 20, it was down to roughly $786 billion . The short sellers, for now, are winning the argument, as they were sitting on an estimated $8.7 billion in paper profits as of mid-July .

SpaceX deliberately spread its insider sales across several dates instead of one, so the market wouldn't get flooded all at once. The first release is still massive. Two trading days after the Aug. 4 report, 911.5 million insider shares will become free to sell — no strings attached.

A second batch of 455.8 million shares does have strings: The stock must close above $175.50 on five of the 10 trading days before the report . That's nearly 40% above today's price.

And the stock is still expensive. Even after the slide, SpaceX was trading at 49 times expected revenue as of mid-July , down from close to 140 times in the frenzy of its first trading days. Morningstar put SpaceX's fair value at $780 billion before the IPO even priced. The market, even now, is paying about double his number.

Before the IPO, getting SpaceX exposure was a sport. People worked every angle — venture funds that happened to hold shares, private-market middlemen charging steep markups, anyone with a connection.