SpaceX ended its first day as a publicly traded company with a 19% gain, as strong investor demand pushed the stock well above its initial public offering price and made founder Elon Musk the world’s first trillionaire.
The stock began trading on the Nasdaq at around $150 per share, roughly 11% above its $135 IPO price set on Thursday.
Shares later climbed to an intraday high of $176, lifting the company’s market capitalization to nearly $2.3 trillion, before closing at $160.95.
Strong demand drives rally
According to Bloomberg, SpaceX’s IPO was four times oversubscribed.
That means many institutional investors received fewer shares than they sought and were forced to buy stock in the open market.
Additional demand has been fueled by the company’s limited public float.
Only about 4% of SpaceX’s shares are available for trading, with employees and early investors holding the remainder.
Index inclusion could boost demand further
SpaceX successfully pushed for changes to inclusion rules used by several indexes, including the Nasdaq 100.
As a result, the company is expected to join those benchmarks within days rather than months.
That could lead to automatic purchases by index funds and other institutional investors.
Robinhood sees record activity
Trading platform Robinhood said it experienced “record-breaking” traffic following the IPO.
The company said some users encountered temporary delays and intermittent issues, but the platform recovered quickly.
Massive returns for venture investors
The public listing has produced one of the largest payouts in venture capital history.
According to Bloomberg:
- Founders Fund, which invested $600 million and owns about a 3% stake, has holdings worth more than $50 billion based on the IPO price.
- Andreessen Horowitz’s stake is valued at more than $10 billion.
- Sequoia Capital’s holdings are worth over $20 billion.
Employees also stand to benefit
The New York Times reported that the IPO will create substantial wealth for current and former employees.
According to the report:
- About 4,400 employees and former employees will become millionaires.
- Around 400 individuals will become centimillionaires.
Musk crosses the trillion-dollar mark
SpaceX’s opening price of $150 pushed Musk’s net worth above $1 trillion, making him the first person to reach that milestone.
The rise in SpaceX shares added to the value of his holdings in the rocket company and Tesla, where he also serves as chief executive.
TL;DR
SpaceX shares climbed 19% in their first day of trading, closing at $160.95 and pushing the company’s valuation near $2.3 trillion. The rally made Elon Musk the world’s first trillionaire and generated enormous gains for employees and early investors.
AI summary
- SpaceX stock rose 19% on its first trading day.
- Shares closed at $160.95 after hitting $176 intraday.
- The company briefly reached a valuation of nearly $2.3 trillion.
- Elon Musk became the world’s first trillionaire.
- Early investors and employees saw significant wealth gains.
