The SpaceX Sell-Off Looks to Be Getting Worse. Here's What Patient Investors Should Do Right Now.

After a debut that sent the stock to a peak near $226 per share within days, Space Exploration Technologies (NASDAQ: SPCX) has given back a large chunk of that run and trades near $160 as of this writing. The pullback has rattled some new shareholders, and the honest read is that it might have more room to fall. That does not make the stock a mistake. It makes the method you use to buy it the thing that matters.

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Why the SpaceX sell-off might get worse

The first pressure is supply. SpaceX staggered its insider lockup, and the first block of shares, nearly 20% of the locked pool, is released after the second-quarter report in late July. Smaller tranches will follow through the fall, with the full 180-day batch clearing in December. More sellable shares meeting the same pool of buyers can press the price lower, and that supply arrives on a schedule the market can see coming.

The second pressure is the price itself. A market value near $2 trillion bakes in moon bases, a high Starship flight rate, and orbital data centers, outcomes that could take a decade to prove. A launch setback or a slipped timeline could reset sentiment in a hurry, and the $226 per-share peak looked more like debut momentum than a considered price. Momentum fades, and a stock that tripled expectations in a week can keep giving back ground.

Why dollar-cost averaging is the move

Instead of one lump purchase at a price no one can predict, dollar-cost averaging commits a fixed dollar amount on a set schedule, month after month, at whatever the price allows. When shares drop, that fixed sum buys more of them; when shares climb, it buys fewer. Across a volatile stock with a known supply calendar, the math lowers your average cost and removes the pressure to call a bottom that no one can call. For a company with a decade-long story and lockups draining out through December, spreading purchases across those same months lines up with the supply.

The approach has limits worth stating. If the stock climbs in a straight line, a single lump-sum buy would have beaten it. And dollar-cost averaging does not fix a weak business; it addresses timing, nothing more. The case rests on the belief that SpaceX is worth owning for years, with the investing schedule managing volatility along the way.

The takeaway for patient investors

The sell-off is uncomfortable, and discomfort is where a patient plan earns its keep. Set an amount you can add on a schedule, tune out the daily move, and let the lockup-driven supply come to you rather than chasing the stock. A brokerage account that supports recurring buys makes the habit automatic. I would treat SpaceX as a position built across quarters, not a trade timed to a bottom.

Micah Zimmerman 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.