Economist Peter Schiff has cautioned against rushing to invest in the hype surrounding a stock, outlining Elon Musk-led Space Exploration Technologies Corp.‘s (NASDAQ:SPCX) recent decline as an example.
SPCX Down Nearly 19% From IPO Value
Taking to the social media platform X on Monday, the Echelon Wealth Partners co-founder said that SpaceX was “coming back down to earth” as shares traded at $110.05, the investor said. SpaceX’s value hit an intraday low on Monday at $108.66, which was also its all-time low.
“That’s 18.5% below the IPO price and 51% below the high” of approximately $225/share following its public debut last month, Schiff said. “This is an example of why it’s so dangerous to rush into buying a heavily hyped IPO during its first few days of trading,” he shared.
According to a report by CNBC on Monday, SpaceX recorded a slide of approximately $1.2 trillion in its market capitalization since its all-time high. Notably, Tesla Inc.‘s (NASDAQ:TSLA) current market capitalization is over $1.221 trillion, while SpaceX is around $1.495 trillion.
Gary Black, Ross Gerber Weigh in on SpaceX
Following the recent decline, investors Gary Black of The Future Fund LLC and Ross Gerber of Gerber Kawasaki shared their takes on the commercial space flight giant. Black said that the only people shocked by the decline were investors who miscalculated the company’s value.
On the other hand, Gerber reaffirmed his backing for the company, saying that SpaceX was doing “incredible” things and pointed to Tesla’s early volatility.
According to Benzinga Edge Rankings, SpaceX fails to provide a favorable price trend in the Short, Medium and Long term.
Price Action: SpaceX shares were down 1.23% to $112.10 during overnight trading on Monday.
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