Cramer Warns on SpaceX IPO; Investors Call It Bullish

Television host Jim Cramer advised investors against buying SpaceX stock before its June 12 Nasdaq debut after the company set an IPO price of $135, valuing SpaceX at $1.77 trillion. The shares are expected to trade under the ticker SPCX, and the offering was reported to be roughly four times oversubscribed.

Cramer cautioned that a large first-day jump would be unhealthy for new buyers because inexperienced retail investors placing market orders rather than limit orders could push the price higher and leave late entrants exposed to a sharp correction. He warned that such price spikes “rarely end well for buyers who chase the open.” Earlier, he described the IPO feeding frenzy as potentially “destructive” for the broader market by pulling capital away from other equities.

Some traders treated his warning as a contrarian buy signal. Market participants pointed to prior instances when his negative calls were followed by rallies, including episodes in 2017, mid-2021 and early 2024 involving Bitcoin. The pattern has prompted the launch of an inverse product in 2023 designed to profit from moves opposite to his public recommendations.

The SpaceX listing will bring an unusual asset to public markets: the company holds 18,712 Bitcoin on its balance sheet, currently worth roughly $2 billion. Public shareholders will for the first time gain direct stock-market exposure to that Bitcoin position, a factor analysts are mapping for its potential effect on cryptocurrency markets and demand for the new stock.

Underwriters reported strong demand for the offering and high retail interest, which increases the potential for volatile early trading. Cramer emphasized order type as an operational concern: limit orders can constrain the entry price, while market orders executed at the open often result in paying high first-day prices. He warned that short-term speculators who rush to sell after an initial pop could trigger rapid price declines.

Large, highly anticipated IPOs have in past episodes produced outsized first-day moves followed by corrections, particularly when buying concentrates among less experienced investors. The size of SpaceX’s valuation and the company’s public Bitcoin holdings add new variables to initial price discovery and investor scrutiny.

SPCX begins trading on Nasdaq on June 12. Initial trading will reveal how demand, order flow and the company’s crypto holdings affect the stock’s early price action.