SpaceX’s first post-IPO lock-up period is set to expire on Aug. 6, according to the Financial Times, opening the door for about 912 million shares to enter the market. That figure is roughly twice the company’s current public float. At present, less than 5% of SpaceX’s total shares are tradeable, but the proportion is expected to rise to about 12% after the first lock-up ends.
The expected increase in available shares has raised concern over near-term pressure on the stock price. Lock-up expiries often lead to added selling pressure and short-term volatility. Historical data cited in the report shows that such events have on average been associated with a roughly 1.5% decline in share prices, though the actual effect depends on how much investors choose to sell and the level of market demand.
Unlike some IPO companies that release all locked shares at once after 180 days, SpaceX is using a phased unlocking structure. A second round of lock-up expiry is expected after the company releases its third-quarter results, which could bring another round of focus to possible stock-price pressure.
SpaceX’s first post-IPO lock-up period will expire on Aug. 6, the Financial Times reported, raising concern that a sharp increase in share supply could weigh on the stock.
About 912 million shares are expected to be unlocked in this round, equal to roughly twice the company’s current public float. Less than 5% of SpaceX’s total shares are currently available for trading, and that proportion is expected to increase to about 12% once the first lock-up period ends.
Lock-up expiries often bring added selling pressure and can trigger short-term volatility. Historical data cited in the report shows that, on average, lock-up expiries may lead to a share-price decline of about 1.5%, although the actual outcome depends on how much investors sell and how strong market demand proves to be.
SpaceX is not following the model used by some IPO companies that release all locked shares in a single batch after 180 days. Instead, it is using a phased unlocking structure. A second round of restricted-share releases is expected after SpaceX reports third-quarter results, a point at which the market may once again focus on potential downside pressure on the stock.
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