Should You Buy SpaceX Stock Before Aug. 4?

Space Exploration Technologies (NASDAQ: SPCX) went public on June 12, and it quickly soared to a peak of $225.64. However, it has since lost 45% of its value, so even investors who bought it at the official initial public offering (IPO) price of $135 are currently underwater.

SpaceX is scheduled to release its operating results for the second quarter of 2026 (ended June 30) on Aug. 4. The report, and the accompanying conference call with CEO Elon Musk, will provide investors with an update on the company's space transportation, satellite internet connectivity, and artificial intelligence (AI) infrastructure businesses.

However, a positive second-quarter report probably won't be enough to spark a recovery in SpaceX stock because of its sky-high valuation. Here's why buying it ahead of Aug. 4 might not be a good move.

Image source: Getty Images.

What Wall Street might be looking for on Aug. 4

SpaceX generated $4.7 billion in total revenue during the first quarter of 2026 (ended March 31), and here was the contribution from each of its three core segments:

Data source: SpaceX.

Connectivity was the biggest source of revenue by far. SpaceX has used its Falcon 9 reusable rockets to launch over 9,600 Starlink satellites into orbit, which provide internet access to 10.3 million paying customers. The upcoming V3 Starlink satellites will deliver 10 times more bandwidth than the current V2 satellites, so they could give this business a huge boost when they start launching later this year.

According to Yahoo! Finance, Wall Street analysts estimate SpaceX generated around $6.87 billion in total revenue during the second quarter, but I think the contributions from its three segments were probably vastly different compared to the first quarter. Connectivity was almost certainly a key source of revenue yet again, but the AI business likely showed substantial growth.

In January, SpaceX acquired Elon Musk's AI start-up xAI, which operates enormous data centers like Colossus and Colossus II. This infrastructure is used to develop AI products like the Grok chatbot, but SpaceX is now renting some of the spare computing capacity to other companies in exchange for massive fees.

In May, SpaceX agreed to rent $1.25 billion worth of computing capacity per month to Anthropic. In June, the company signed two more deals: one to rent $920 million worth of capacity per month to Google parent Alphabet starting in October, and another to rent $150 million worth of capacity per month to Reflection AI.

As a result, revenue from the AI business likely surged in the second quarter compared to the first quarter, which is something Wall Street analysts might hang their hats on to justify SpaceX's hefty valuation.

A positive quarterly report might not turn SpaceX stock around

Despite the recent decline in SpaceX stock, it's still trading at a steep premium to the broader market. Its price-to-sales (P/S) ratio of 83.7 is more than 13 times higher than the P/S ratio of the Nasdaq-100 index, which is currently 6.2. In other words, SpaceX stock appears to be heavily overvalued relative to a basket of its big-tech peers.

One single quarterly report is unlikely to show enough growth to make the stock look attractive at the current price. In fact, even if we use Wall Street's 2027 revenue estimate of $72.3 billion, SpaceX has a forward P/S ratio of 23.3, which is still very expensive compared to the Nasdaq-100.

As a result, investors who buy this stock today need to have a very long-term time horizon of at least five years to give the company time to grow into its valuation. There is every chance it will eventually do so, because management believes its addressable market is worth $28.5 trillion across all three of its businesses.

The AI infrastructure market alone could be worth $26.5 trillion. In the future, Elon Musk thinks SpaceX can launch computing clusters into orbit, where they will run on solar power and won't need complex cooling systems. Starlink satellites can beam the data down to Earth, so the company already has distribution sorted, giving it a huge advantage over any potential competitors.

With all of that said, I wouldn't be piling into SpaceX stock ahead of its Aug. 4 report in the hope an immediate recovery will follow. This is very much a long-term story.

Anthony Di Pizio has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Alphabet. The Motley Fool has a disclosure policy.