SpaceX Stock Today Has These 2 Positives. The Stock Is Still Falling.

SpaceX stock declined almost 4% on Wednesday after Democratic candidates won the Senate and gubernatorial races in the company’s home state of Texas. (Brandon Bell/Getty Images)

Key Points

SpaceX stock falls below its $135 initial public offering price in premarket trading Thursday.
Investors fear Democratic election wins in Texas could slow building plans in the state for SpaceX and Tesla.
Cathie Wood’s ARK Invest bought nearly 350,000 shares of SpaceX on Wednesday across three funds.

SpaceX stock was falling in premarket trading Thursday, dipping below its initial public offering price of $135 in June, following a new Buy rating on Wall Street and more buying from growth investor Cathie Wood.

Shares of Elon Musk’s rocket and artificial-intelligence company were down 1.1% at $134.33 in premarket trading, while S&P 500 and Dow Jones Industrial Average futures were up 0.2% and 0.7%, respectively.

The drop came after Wednesday’s 3.8% post-election decline. Democratic candidates won the Senate and gubernatorial races in Texas, which investors fear could slow Tesla and SpaceX building plans in the state.

The dip was an opportunity for ARK Invest’s Cathie Wood. Her firm bought almost 350,000 shares of SpaceX on Wednesday in three funds: the flagship ARK Innovation ETF, the ARK Autonomous Technology & Robotics ETF, and the ARK Next Generation Technology ETF.

Tesla and SpaceX are the top two positions in the ARK Innovation and ARK Autonomous Technology & Robotics ETF s. Tesla is the top stock in the Next Generation ETF. SpaceX is the sixth largest position, behind Tesla, Meta Platforms , Amazon.com, Circle Internet, and Shopify.

Wood is a long-time fan of Musk’s companies. Wood buying the dip shouldn’t surprise investors.

It wasn’t, however, helping SpaceX on Thursday. Neither is a new rating from China Renaissance. The broker initiated coverage of SpaceX with a Buy rating and a $194.20 price target, according to ratings aggregators. Barron’s hasn’t seen a copy of the report.

Overall, SpaceX is popular on Wall Street, with 77% of analysts covering the company rating its shares Buy. The average Buy-rating ratio for S&P 500 stocks typically ranges from 55% to $60%.

The average analyst price target for SpaceX stock is $256, up almost 90% from recent levels.

Write to Al Root at allen.root@barrons.com.

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