SpaceX (NASDAQ:SPCX) stock has fallen since its record-breaking IPO with shares hitting new lows Monday. Shares are rebounding Tuesday, which could be thanks to a warning shot given to short sellers by SpaceX CEO Elon Musk.
SpaceX Short Bets Grow
With questions on valuation and the high publicity around the SpaceX IPO, the number of short bets against the company has grown, and those betting against the price of the space stock have been raking in paper profits.
Recently, Musk gave a warning to anyone shorting SpaceX stock.
"The survival probability of firms who maintain a significant short position in SpaceX over time is very low," Musk tweeted in response to a user.
The user called into question the people betting against SpaceX, saying they are likely well-educated individuals with "perfect resumes" who don’t understand the long-term potential of SpaceX and its total addressable market.
"The graduates celebrate their six-week victory on a twenty-year bet. Me, I buy your bags on every dip," the user said.
The social media user also quotes a recent tweet from Musk that said SpaceX would be worth more than Earth if the company achieves its goals.
While Musk’s tweet is several days old, it was a reply that may have been buried and not seen by as many people. An article by Teslarati brought the warning into plain sight and could be among the reasons why SpaceX stock is climbing higher Tuesday.
Musk’s History vs. Short Sellers
Those who have followed Musk for years know that he has a long history with short sellers of Tesla Inc (NASDAQ:TSLA), the electric vehicle company he also leads.
In 2018, Musk told short sellers they had "about three weeks before their short position explodes," as reported by Teslarati.
Musk has said over the years that short selling should be illegal.
The billionaire has also clashed with fellow billionaire Bill Gates, who famously opened a short position against Tesla. Musk refused to talk to Gates about clean energy initiatives and philanthropic efforts unless the billionaire closed his short position.
"Sorry, but I cannot take your philanthropy on climate change seriously when you have a massive short position against Tesla, the company doing the most to solve climate change," Musk previously told Gates.
In 2024, Musk replied to a user on social media that anyone holding a short position "will be obliterated" when Tesla achieves full autonomy and volume production of the Optimus humanoid robot, adding "even Gates" in a reference to Bill Gates.
Last year, Musk sent the same warning about short sellers being "obliterated" when Tesla reaches "autonomy at scale."
Musk also poked fun at hedge funds and investors shorting the stock by issuing “short shorts” merchandise previously. In July 2020, the Tesla website crashed with the apparel launched for $69.420 each. The shorts remain a popular collector’s item today.
While SpaceX has launched merchandise since going public, there are no short shorts available yet.
SpaceX Stock Price Action
SpaceX stock is up 6.2% to $127.31 on Tuesday versus a trading range of $119.68 to $225.64 since going public at $135 per share in June.
Photo: Thrive Studios ID / Shutterstock
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