Mark Your Calendar: SpaceX Could Be a Very Different Stock by Halloween

The Space Exploration Technologies (NASDAQ: SPCX) initial public offering (IPO) was a major success. Initially, the company (commonly known as SpaceX) targeted a $1.77 trillion valuation, enough to fund a $75 billion capital raise. Today, SpaceX's market cap is closer to $2.5 trillion, with total IPO proceeds ending up at around $86 billion.

Demand for the IPO far outstripped available supply. On June 5, it was reported that underwriters had received orders for twice the amount of shares they were authorized to sell. Actual demand on June 12, the date of the IPO, may have been four times higher than supply.

Part of this had to do with investor appetite for SpaceX stock, which was one of the hottest IPOs in history.

Much of the oversubscription, however, related to how little stock was actually made available for sale. Less than 5% of shares were available for public trading. Early investors, employees, and founder Elon Musk control the rest.

Image soruce: Getty Images.

But that's set to change soon. And by Oct. 31, just in time for Halloween, the number of publicly traded shares could soar due to one catalyst.

Expect SpaceX's share lockup schedule to look like this

Most IPO stocks set lockup restrictions on major shareholders during a public sale to prevent them from cashing in immediately and affecting the short-term stock price. Often, major shareholders need to wait 180 days before shares become available for them to sell, should they wish to. SpaceX's lockup period is a bit more nuanced.

Business Insider wrote, "SpaceX's unlock calendar looks a little different, using staggered release dates at predetermined timelines and milestones." Some shares are unlocked after 70 days, others after 90 days, with bigger unlock amounts triggered after second-quarter earnings and third-quarter earnings.

The biggest unlock date is in June of 2027, when Elon Musk is eligible to begin selling his huge 42% stake. Still, the number of publicly available shares is set to double by the end of August 2026, with one-third of shares unlocked by the end of October. That's a huge increase from today's publicly tradable shares. The real test won't come until the lockup period expires, Business Insider wrote.

Perhaps the shares struggle once the publicly traded float expands heavily. But there could be more catalysts in the meantime that prop up the price.

SpaceX, for example, qualified for Nasdaq's new fast-entry rule. It will join the index after 15 days of trading, forcing funds that track the benchmark index to buy shares while the float remains relatively low.

In the end, the most important long-term catalyst for the stock price will be the company's underlying business performance. But share-unlocking schedules have had an impact on past major IPOs. Given that SpaceX's current public float remains below 5%, anything can happen once this figure balloons.

Ryan Vanzo has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.