History Says You Can Get a Better Deal on SpaceX Stock If You Wait This Long
Written by Chris Neiger for The Motley Fool -> SpaceX popped about 20% above its IPO price on its first day of trading. Historical data shows large, hot IPOs often have very modest gains after one year. If you're considering buying SpaceX, waiting out the initial pop is likely
SpaceX popped about 20% above its IPO price on its first day of trading.
Historical data shows large, hot IPOs often have very modest gains after one year.
If you're considering buying SpaceX, waiting out the initial pop is likely a wise move.
Elon Musk's Space Exploration Technologies (NASDAQ: SPCX) , or SpaceX, gained about 20% on its first day of trading on Friday, June 12, and continued climbing higher in the days after becoming a publicly traded company, as of this writing.
The result has pushed SpaceX's valuation above $2.5 trillion and made Musk the world's first trillionaire. Figures that high are difficult to comprehend, even for someone who writes about financial topics every day.
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But despite SpaceX's initial success, history is not kind to blockbuster initial public offerings (IPOs). In fact, those that have huge gains in the first week of their IPO rarely hang on to those gains a year later. Here's why it might be better to wait out the buying frenzy right now if you want to own SpaceX stock .
SpaceX shares were already priced at a premium for the IPO, but they've rocketed even higher since then. Its current price-to-sales is an astonishing 130, compared to about 10 for the average tech stock.
