SpaceX (SPCX) entered its Nasdaq-100 debut week with SPCX stock falling 1% on Monday, extending a pullback after losing another 1% over the past week, while shares were down 2% overnight late Monday. The stock decline comes as the company prepares to join the Nasdaq-100 at the start of trading on Tuesday, triggering automatic demand from index-linked funds. Billionaire value investor Jeremy Grantham criticized SpaceX's valuation in a Morningstar interview, calling it the "craziest IPO in the history of man" and saying the company is "rolling in red ink." The company's initial index weight is expected to be limited to about 1% to 1.3% because less than 5% of shares were sold publicly in last month's offering. The debut occurs amid questions about whether SpaceX's AI-driven valuation can withstand scrutiny, with Grantham arguing that 90% of the projection depends on the company's "currently third-rate AI offering" being "kicked around the block" by Anthropic and OpenAI.
SpaceX Joins Nasdaq-100 With Limited Index Weight
SpaceX is set to enter the Nasdaq-100 at the start of trading on Tuesday, triggering automatic demand from index-linked mutual funds and ETFs, including Invesco's QQQ. The company was fast-tracked into the benchmark under rules designed to include newly public megacap companies sooner. Its initial index weight is expected to be limited to about 1% to 1.3%, far below what its $2 trillion market value would otherwise imply.
SpaceX sold less than 5% of its shares in last month's public offering, while employee and insider lockups restrict additional supply. Since Nasdaq adjusts weights based on free float, the limited public availability constrains the index weighting.
Some insider lockups are expected to expire in tranches between 70 and 135 days after SpaceX's June 12 IPO. CEO Elon Musk's shares and certain large-holder restrictions are expected to remain locked for about a year.
Jeremy Grantham Criticizes SpaceX Valuation and AI Strategy
Jeremy Grantham, investment strategist at GMO, criticized SpaceX's valuation in a Morningstar interview. Grantham is a value investor known for warning about major market bubbles, from Japan in 1989 and the dot-com peak in 2000 to the 2008 housing crisis.
Grantham called SpaceX the "craziest IPO in the history of man," arguing that investors may look back on the prospectus decades from now as a symbol of market excess. He said the company is "rolling in red ink" despite its towering valuation. Grantham argued that much of the long-term case rests on aggressive AI assumptions, saying 90% of the projection depends on SpaceX's "currently third-rate AI offering," which he said is being "kicked around the block" by Anthropic and OpenAI.
xAI, acquired by SpaceX in an all-stock deal in February 2026 and now being rebranded as SpaceXAI, gained further momentum in June with SpaceX's $60 billion all-stock acquisition of Cursor parent Anysphere. The deal is expected to bolster Grok by combining Cursor's coding intelligence and developer data with xAI's Colossus supercluster. The AI push is unfolding as rival AI leaders Anthropic and OpenAI prepare for mega public listings, with private valuations of about $965 billion and $852 billion, respectively.
Grantham acknowledged that index inclusion could lift the stock in the short run as forced buying may outstrip available supply: "So supply and demand being what it is, it's hard to imagine the price won't go up, and perhaps it will go up a lot." He warned that the longer-term risk remains severe, saying he would "bet at least 90%" on a crash rather than SpaceX ultimately justifying its current valuation.
Grantham also questioned SpaceX's broader AI and space assumptions, saying some productivity claims show "no idea what they're talking about" and that much of the space-travel ambition in the prospectus would be viewed by serious physicists as "utterly inconceivable."
Retail Trader Sentiment Shifts to Bearish
On Stocktwits, retail sentiment for SPCX flipped to 'bearish' levels over the past week from 'extremely bullish' levels at the time of listing amid a 26,150% surge in message volumes over the past month.
One user said, "$SPCX The 'Forced' Buying begins. Puts will go to ZERO."
Another user said, "$SPCX only about 10% of the inclusion has actually happened. The largest bulk will occur tomorrow around 3 PM."
FAQ
What happened to SpaceX stock on Monday?
SPCX stock fell 1% on Monday, extending a pullback after losing another 1% over the past week. Shares were also down 2% overnight late Monday.
Why is SpaceX's Nasdaq-100 index weight limited?
SpaceX's initial index weight is expected to be about 1% to 1.3% because less than 5% of shares were sold publicly in last month's offering. Nasdaq adjusts weights based on free float, which constrains the weighting despite the company's $2 trillion market value.
What did Jeremy Grantham say about SpaceX's valuation?
Grantham called SpaceX the "craziest IPO in the history of man" and said the company is "rolling in red ink." He argued that 90% of the projection depends on SpaceX's "currently third-rate AI offering" being "kicked around the block" by Anthropic and OpenAI.
