CNBC host Jim Cramer shared an insider lockup tracking sheet revealing that up to 1.31 billion SpaceX shares—the largest unlock batch since the company's June initial public offering—will become eligible for sale two trading days after third-quarter earnings are released. The revelation follows Friday's unlock of up to 328.4 million shares, which financial outlet Motley Fool estimated to be worth nearly $51 billion.
Key Takeaways
- Friday Unlock Executed: Up to 328.4 million shares valued at approximately $51 billion were released from insider restrictions.
- Largest Unlock Ahead: Up to 1.31 billion shares will open for trading two business days after SpaceX posts Q3 earnings.
- Valuation Discrepancy: Shares trade at 137 times expected 12-month earnings per FactSet data, while short-seller George Noble set fair value at $30 in August.
- Spectrum Deal Surge: SpaceX stock rose 3.9% pre-market Friday following a direct-to-cell Starlink agreement.
Insider Lockup Schedule and Valuation
When SpaceX listed in June, early investors and employees signed lockup agreements committing not to sell their equity immediately. Jim Cramer posted a printout tracking the step-by-step expiration dates, pointing out that Friday's 328.4 million share release is set to be followed by a post-earnings batch four times larger. SpaceX has not yet announced the date for its Q3 earnings release.
Despite Motley Fool labeling the unlock schedule a fleecing of retail investors, Cramer defended SpaceX's equity price on air, asserting that while some stocks are "insanely priced," SpaceX is not among them. FactSet metrics show SpaceX trading at 137 times expected 12-month earnings. In contrast, investor George Noble, who is shorting the stock, stated in August that fair value sits at $30.
Historical Performance and Market Impact
Stock performance surrounding previous unlock events has varied. SpaceX shares appreciated near its August lockup release but dropped after subsequent unlocks, including the September 24 release. In July, Cramer advised Mad Money viewers to remain patient and wait for the initial lockup expiration before acquiring large positions.
Market volatility around the lockup tracker comes as SpaceX expands its telecommunications business. A deal struck on Thursday enabling Starlink to sell phone coverage directly caused SpaceX shares to climb 3.9% before Friday's open, while competing telecom carrier stocks plummeted.
Why It Matters
Massive insider unlocks test market depth for premium-valuation growth stocks, particularly when early backers hold billions in potential profits. While share eligibility does not guarantee immediate selling, freeing 1.31 billion shares creates a significant potential supply overhang. Investors must determine whether Starlink's expanding direct-to-cell telecom utility can absorb potential insider liquidations once Q3 earnings pass.
