Down 30% From Its High, Is SpaceX Stock a Buy Now?

Space Exploration Technologies (NASDAQ: SPCX), better known as SpaceX, got off to a hot start after its IPO. From its initial trading price of $150, it rose over the course of a few days to an intraday high of $225.64. Then, after some of the initial hype died down and the company announced it was raising more money via a bond issue, the stock slumped. It has rebounded modestly in recent days, but as of Thursday, it was still about 30% off its all-time high.

So, is SpaceX a great stock to buy on the dip? Or should you be patient?

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SpaceX has a big valuation to grow into

SpaceX may be one of the more misunderstood stocks in the market. If asked to describe what SpaceX does, many would likely say it launches reusable rockets to deliver payloads into space. While that's true, it doesn't fully capture the nature of the business.

The majority of SpaceX's revenue and growth comes from Starlink, which offers broadband internet connectivity via a constellation of orbiting satellites. The connectivity segment of SpaceX's business is also the most profitable. The space segment, which includes its rockets, accounts for only about 22% of revenue and 11% of profits. The third segment, AI, largely comes from xAI, another Elon Musk-owned company that it recently acquired. That segment generates revenue from anyone who uses the Grok artificial intelligence platform, as well as from the social media platform X (formerly Twitter).

In 2025, SpaceX generated $18.7 billion in revenue and reported a net loss of $4.3 billion. While that lack of profitability is not the biggest concern, the reality is that SpaceX trades at a massive premium on a price-to-sales basis. With a $2.08 trillion market cap, SpaceX trades for 111 times 2025 sales. Valuations that high are normally reserved for companies that are doubling or tripling their revenue year over year. For 2026, the consensus forecast among Wall Street analysts is that SpaceX will bring in $36.9 billion in revenue. That still prices the stock at 56 times forward sales, which is very expensive for the growth the company is delivering.

This leads me to conclude that SpaceX stock is overvalued, based on its current business. That's important to note, because just like Musk's other public company, Tesla, SpaceX is now being priced based on its CEO's grand plans and promises of future growth.

Investors need to decide for themselves whether today's price is too high or worth the cost for a chance to profit on that potential. Even if the stock trades essentially flat from here, it may be years before SpaceX improves its financials enough to trade at a reasonable valuation. It's also possible that it never will. Until SpaceX can deliver results that match its vaunt, I'm going to stay on the sidelines.

Plus, I think it would be smart for investors to wait until they've seen a few quarterly earnings reports from the company before buying SpaceX stock, as they could reveal more information regarding how its businesses are performing and how management views its growth opportunities.

Keithen Drury has positions in Tesla. The Motley Fool has positions in and recommends Tesla. The Motley Fool has a disclosure policy.