SpaceX is set to make a historic public debut, potentially raising $75 billion at a valuation of $1.75 trillion, positioning it among the largest public companies. However, a review by Truist Wealth of 30 major IPOs over the past 15 years reveals that, on a median basis, these stocks typically drop 9% within the first year, with an average decline of 14%.
Furthermore, the majority of these companies faced severe volatility, with stock prices plunging by 54% on a median basis. The anticipated high retail participation, with SpaceX planning to offer up to 30% of its shares to individual investors, could exacerbate this volatility.
Historical examples, such as the 2012 IPO of Meta Platforms and Alibaba's IPO, illustrate the potential for significant initial losses. As SpaceX prepares for its Nasdaq debut on June 12, investors should be aware of these trends and the associated risks