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▲ SpaceX (SPCX)/AI Generated Image
SpaceX (SPCX) is set to release its first earnings report since going public. Its stock price has fallen by 20% from the public offering price, and immediately after the earnings announcement, restricted shares worth $99 billion will be released.
According to cryptocurrency media outlet BeInCrypto on August 2 (local time), SpaceX sold 555,555,555 shares at $135 per share on June 11. The amount raised was $75 billion, more than double Saudi Aramco's record of $29.4 billion set in 2019. Ten IPO underwriters, including Morgan Stanley, shared approximately $100 million in fees.
Morgan Stanley achieved asset inflow effects greater than its fees. New client funds in Morgan Stanley's wealth management division totaled $148.1 billion last quarter. This is more than double the $59.2 billion from the same period last year. More than half of the new funds, $74 billion, came from stock compensation accounts of IPO clients, including SpaceX.
Morgan Stanley provides stock compensation services to more than half of S&P 500 companies and approximately 70% of the top 100 unlisted companies with a valuation exceeding $1 billion. Total client assets have surpassed $10 trillion. Jed Finn, head of Morgan Stanley's wealth management division, said, “It's wrong to view an IPO as a one-time asset attraction event.” He explained that additional revenue opportunities follow during the lock-up release and new share issuance process.
However, only 26% of new funds last quarter moved to fee-based managed accounts. This is significantly lower than 72% a year ago. The annual revenue expected to be generated from SpaceX-related funds is estimated to be over $100 million. Many shares are still in lock-up, so it will take time for actual revenue conversion.
SpaceX will announce its first quarterly earnings since its listing after market close on August 4. The market expects a loss of $0.26 per share. The stock closed at $108.37 on July 31, down 20% from its public offering price. This is 33% lower compared to the closing price of $161 on the first day of listing. Despite securing a $1.6 billion U.S. Space Force launch contract until 2027, it could not prevent the stock price decline.
Two days after the earnings announcement, on August 6, 911.5 million restricted shares will become tradable. Applying the closing price of July 31, their value is approximately $99 billion, which is greater than the IPO proceeds. Morgan Stanley decided to raise its quarterly dividend by $0.15 to $1.15 and also approved a $20 billion share buyback. For SpaceX investors, a period of volatility remains, with the first earnings report and lock-up release occurring consecutively.
[Key Article Summary]
-SpaceX set a record for the world's largest IPO by raising $75 billion, but its stock price has fallen by 20% from the public offering price.
-More than $74 billion in client funds flowed into Morgan Stanley's wealth management division due to the SpaceX listing and other factors.
-Two days after the first earnings announcement, approximately $99 billion worth of restricted shares will become tradable.
*Disclaimer: This article is for investment reference only, and we are not responsible for any investment losses based on it. The content should be interpreted for informational purposes only.*
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