SpaceX's Next Share Unlock Is Coming. History Says This Is What Happens Next.

Space Exploration Technologies (NASDAQ: SPCX) went public in June and immediately became one of the market's biggest battleground stocks. While the company's share price has seen significant valuation swings and is down roughly 34% from its lifetime high, it has also seen strong pricing support above the $135 per share at which it was listed for its initial public offering (IPO). The stock is also currently roughly in line with the $150-per-share price at which it opened on the day of its IPO.

On the other hand, SpaceX stock is on the verge of another major lockup expiration -- an event that will make a large tranche of shares available for sale by insider owners. Here's what history says that could mean for other shareholders.

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SpaceX's lockup expirations could pressure the stock

On Sept. 24, up to 328.4 million shares of SpaceX stock will be unlocked for sale. With a substantial number of shares potentially hitting the market, the company's stock price could face significant pressure.

SpaceX currently has a market capitalization of roughly $2.05 trillion, and insider shareholders have the opportunity to lock in life-changing wealth by selling some of their stock at current levels. That doesn't necessarily mean that these insiders don't have confidence in the company. Employees at all levels of the company own SpaceX stock, and the company has seen enormous valuation growth from its early days through the lead-up to its IPO and short history as a publicly traded business.

The last lockup expiration for the stock occurred on Sept. 9 and coincided with a 3.9% decline for the company's share price in the daily session. Given historical trading trends on days in which a large new tranche of shares becomes available for sale, it's reasonable to expect that the stock will face some meaningful selling pressure on Sept. 24. On the other hand, that doesn't necessarily guarantee that the stock will lose ground in the session or that it will move lower in the lead up to the next round of new shares becoming eligible for sale.

What about other lockup expirations for the stock?

While the lockup expiration for SpaceX stock on Sept. 24 looks to be a significant event, it's actually part of a bigger lockup expiration chain on the horizon. Up to 328.4 million new shares will become eligible for sale on both Oct. 9 and Oct. 24. Up to 1.3 billion shares will become available for sale following the company's Q3 earnings release, and roughly 800 million additional shares will then be unlocked for sale on Dec. 8 -- but an even bigger lockup expiration is set to occur next year.

On June 12, one year after SpaceX's IPO, CEO Elon Musk's stake in the company will become eligible for sale. According to the last available regulatory filings, Musk owns roughly 48.4% of the company's stock.

Again, lockup expirations don't necessarily mean a company's share price will see a big pullback. If investors become more confident about the macroeconomic backdrop and SpaceX delivers encouraging business news, the company's valuation could climb substantially even if some insiders sell stock. The lockup expirations mean a large number of shares will become unlocked for sale by insiders, but the stock could still climb through and after these events if there is strong market demand.

What's next for SpaceX?

While SpaceX trades at a highly growth-dependent valuation that makes its stock a risky play, the company's business performance has generally looked encouraging recently. In its August Q2 report, SpaceX announced a loss of $0.09 per share on sales of $7.81 billion -- significantly better than the average analyst estimate, which called for a per-share loss of $0.26 on revenue of $6.93 billion.

SpaceX's revenue increased 92% year over year in the quarter, and its net loss narrowed to $541 million from roughly $1 billion in the prior-year quarter, even as the company continued to spend heavily to improve its position in the artificial intelligence (AI) market. While Musk's company remains best known for its Starlink and rocket businesses, AI is actually the most important part of the business's growth strategy. If SpaceX succeeds in its ambitions in the category, selling pressures connected to lockup expirations won't matter over the long term.

Keith Noonan 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.