SpaceX’s stock has dropped 25% percent since its June IPO, a selloff driven by the widening gap between its trillion‑dollar valuation and the deep losses inside its launch and AI units. As debt markets reprice the company’s risk and insiders prepare for a major unlock, investors are reassessing whether Starlink’s cash flow can support the rest of the business.

Due to equity investors’ faith in CEO Elon Musk, the company was valued at $1.8 trillion while its actual business — which burns billions in cash — raises concerns among debt-holders, according to the New York Times.

The equity is built on a conglomerate of unrelated business lines. As I wrote in May, SpaceX consists of a satellite-internet cash cow forced to subsidize a money-losing AI lab, with Musk holding 85% of the votes and aiming at a huge bonus tied to colonizing Mars. Meanwhile, the company’s investment-grade (Baa1/BBB /BBB) debt trades like junk.

Wall Street analysts have not reached a consensus on where the stock will go next. CFRA’s price target — citing the risk SpaceX will fail to achieve its goals for Starship revenue, AI data centers in space, and making money from its chatbot xAI and the former Twitter (X) — implies SpaceX shares will drop another 23%. Raymond James believes the company’s total addressable market is $30 trillion — $1.5 trillion more than Musk does — and envisions SpaceX shares soaring 433%.

SpaceX’s Business Lines Are Pulling In Different Directions

SpaceX consists of three largely unrelated businesses — one of which is profitable but declining, while the other two burn through huge........

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