- Across online investing forums, users complained of allocations as small as a single share of SpaceX despite requesting far larger amounts.
- Those who did receive stock are taking sharply different approaches, with some selling into the company’s market debut while others are holding for the long haul.
Ross Cameron, 41, founder of trading education platform Warrior Trading, also came away with far fewer shares than he sought. He initially requested 2,500 shares through Schwab before increasing the order to 4,250 shares ahead of the deadline. He ultimately received 147 shares at the IPO price of $135.
“I would’ve liked to have gotten more shares filled because it would’ve increased my total profit, but I understand the demand was very high,” Cameron said. “My plan is to hold the shares unless they break $150, and take profit if they get closer to $200 a share.”
Cameron is also cautious about the months ahead, expecting a wave of selling pressure once lockup restrictions expire and additional shares become available for trading.
“I still think that the next six months will create a wave of selling due to the lockup expiration period,” Cameron said. “I don’t think there will be enough buying to support the current prices when those shares come onto the market.”
Most subscribed offering
Demand was intense across brokerage platforms. SoFi Technologies said SpaceX was the largest and most subscribed offering in its history, while Charles Schwab described client interest as “unprecedented.” SoFi, Fidelity, Robinhood and Schwab all allocated shares to every eligible customer who sought to participate. However, many investors appeared to receive only a fraction of their requested orders as demand far exceeded available supply.
Others investors are taking a longer-term view. Helaine Markham, co-owner of Markham Trading, received all two shares she requested in the IPO and intends to hold the stock.
Markham said she has not added to her position because she views SpaceX’s valuation as “aggressive” and expects additional volatility as lockup restrictions expire and more shares become available for trading. She plans to wait for further price discovery before potentially increasing her stake.
The mixed reactions highlight the challenge facing investors trying to value one of the market’s most closely watched companies. While some see SpaceX as a rare long-term opportunity tied to the growth of Starlink and commercial space exploration, others are wary of the company’s now $2 trillion valuation and are choosing to take profits early.
Symbolic one-share allocations
Justin Sacco, founder of Sacco Financial, received 11 shares through Charles Schwab after requesting 75. Rather than sell, Sacco added to his position after the stock started trading, purchasing four additional shares in the open market and bringing his total holdings to 15 shares.
“I was certainly hoping to receive more than 11 shares after requesting 75,” Sacco said. “At the same time, considering the unprecedented demand for the IPO, I wasn’t shocked by the outcome. The fact that I received a meaningful allocation at all felt like a win.”
Sacco said he plans to hold these shares long term even though he has grown concerned about the lofty valuation.
Sacco’s experience was relatively fortunate compared with some retail investors. On Reddit’s WallStreetBets forum, users posted screenshots showing allocations of just a single share despite requesting hundreds or even thousands. Others joked that the tiny allocations amounted to little more than a souvenir from one of the most anticipated IPOs in recent memory.
