Key Points

SpaceX rose sharply following its IPO but has since eased back.
AI serves as SpaceX primary growth driver yet that factor will unfold over years.
Meanwhile the stock may face pressure from an elevated valuation.
10 stocks we prefer over Space Exploration Technologies

Space Exploration Technologies (NASDAQ: SPCX) known as SpaceX began trading at $150 on its IPO debut. An investment of $1,000 at that point would now equal roughly $1,080. That result falls short of impressive gains.

Still perspective helps. The move reflects an 8 percent advance over several weeks. SpaceX shares also climbed to $225 at their peak before retreating so larger gains were possible for those who exited nearer the high.

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The key issue ahead is whether shares can regain upward drive in the near term. Certainty remains elusive yet investors may fare better viewing SpaceX as a long horizon holding instead of a quick profit play. The reasons below explain why returns could develop slowly.

Image source: Getty Images.

AI driven space efforts will require years

While many link SpaceX to rockets the firm sees most future worth arising from artificial intelligence expansion. AI covered nearly all of the $28.5 trillion market opportunity listed in the S-1 filing aside from $2 trillion. SpaceX combined with xAI during February 2026 and intends to develop AI systems in orbit such as satellites and data centers.

Progress will require time. A Reuters account notes SpaceX may start orbital AI test launches by late next year. Beyond CEO Elon Musk history of adjusting timelines further years will likely pass before launches construction and revenue generation affect results in meaningful ways.

This does not rule out eventual success. Investors should however align expectations correctly. SpaceX represents a compelling growth narrative across five 10 or even 20 years rather than the coming 12 months.

SpaceX valuation may weigh on shares

Given that timeline the current valuation stands out as a key influence on near term results. SpaceX marked the largest and most watched IPO ever which priced shares to capture widespread enthusiasm.

Shares now carry a $2.1 trillion market value placing the firm among the globe most valuable businesses.

SpaceX posted $18.6 billion in revenue for 2025. That yields a price to sales multiple of 112. Each invested dollar therefore buys under one cent of annual sales. Maintaining such multiples proves challenging and past cases show new listings often stall when results fall short of lofty hopes.

Early buyers may therefore wait years for desired gains. This observation does not diminish the company achievements. The price paid remains central to outcomes.

Is now the time to purchase Space Exploration Technologies shares?

Prior to buying consider the following.

The Motley Fool Stock Advisor team recently named the 10 top stocks for purchase today and Space Exploration Technologies did not appear. The selected 10 holdings may deliver substantial gains ahead.

Note that Netflix joined the list on December 17 2004 and a $1,000 stake then would now equal $418,761. Nvidia joined on April 15 2005 and the same $1,000 would now equal $1,195,804.

Stock Advisor overall average return stands at 918 percent far ahead of the S and P 500 208 percent result. Review the latest top 10 list via Stock Advisor and join a community of individual investors.

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Stock Advisor returns as of July 6 2026.

Justin Pope holds no positions in mentioned stocks. The Motley Fool holds no positions in mentioned stocks. The Motley Fool maintains a disclosure policy.

The views expressed are those of the author and may not reflect those of Nasdaq Inc.