SpaceX has become one of the biggest short targets in the U.S. equity market, with nominal short interest rising to about $23.6 billion, above Tesla’s roughly $22 billion, according to S3 Partners data cited by BlockBeats on Aug. 3.
Investors are currently short about 206 million SpaceX shares, equal to around 32.2% of the company’s public float, the data showed.
Bearish bets are focused on earnings and share unlocks
Short sellers are positioning around SpaceX’s first quarterly results since its listing, as well as the potential stock pressure from an internal shareholder unlock scheduled to begin this week.
When SpaceX first went public in June, short interest was only about 40 million shares, representing roughly 5% to 7% of its public float. As the stock fell sharply, short positions climbed quickly. Since its first trading session on June 12, SpaceX has shed more than $500 billion in market value, and its share price has dropped more than 50% from its intraday high.
Bernstein expects the float ratio to reach about 40% by December
Bernstein data showed that the first unlock this week will allow about 20% to 30% of restricted insider shares to be sold. After that, shares equal to about 7% of total shares outstanding will be unlocked in stages before October. Another round of unlocking is expected after third-quarter earnings, followed by more shares becoming available once the 180-day lockup expires.
Bernstein said SpaceX’s public float could rise to around 40% of total shares outstanding by December.
Analysts said some investors are unwilling to buy SpaceX based on fundamentals for now because of the continued overhang from future unlocks. The market is also watching the company’s first post-listing quarterly report, due after the U.S. market closes on Tuesday, for a read on the performance of its rocket launch business, Starlink and AI operations.