Elon Musk Says the Short Sellers Betting Against SpaceX Have a "Very Low" Survival Probability. Their Bets Now Equal 32% of the Float.
2026-07-22 03:23
•Daniel Sparks •The Motley Fool
••• • Axe Capital view
Elon Musk’s SpaceX Bet: What South African Investors Should Watch
SpaceX’s heavy short interest and lofty valuation signal caution, with a potential short squeeze adding volatility ahead of earnings.
SpaceX’s 32% short interest is massive, especially for a company listed in the US, and CEO Elon Musk’s dismissive take on short sellers fuels a tense outlook. The firm’s 33% revenue growth is impressive, yet the 80-plus times sales multiple makes it a risky bet, given it has no profits yet. For South African investors, this means watching the USD/ZAR closely. A short squeeze or earnings surprise might strengthen the dollar against the rand temporarily, pressuring local exporters and large dual-currency earners like Naspers and MTN. Conversely, a disappointing report could ease USD strength and benefit rand-linked stocks. The expanding share supply from lock-ups also threatens to cool any short squeeze rally. I’d be cautious here and not chase the hype until the earnings report, due August 4, lays out clearer fundamentals. this is just my opinion and not financial advice
Wait for the earnings report before increasing exposure to dual-listed stocks sensitive to USD moves like Naspers and MTN. Watch USD/ZAR closely around earnings for trading opportunities.
- USD/ZAR
- Naspers
- MTN
- Disappointing SpaceX earnings could tumble tech-linked shares and weaken USD/ZAR
- A surprise short squeeze might strengthen the dollar, pressuring rand earners
6/10
SpaceX faces a massive short position of 206 million shares (32% of tradable float) worth $25 billion. CEO Elon Musk claims short sellers have "very low" survival probability, but the stock has fallen 45% from its post-IPO peak to $123.46. While a potential short squeeze could occur before the company's first earnings report on Aug. 4, expanding lock-up expirations will increase share supply, potentially easing short pressure. The stock trades at 80+ times sales despite impressive 33% revenue growth, leaving valuation concerns unresolved.
This article was originally published by The Motley Fool and has been adapted here for Axe Capital Trading News.
Publisher: The Motley Fool
Author: Daniel Sparks
Categories: Equities, Earnings, IPOs
Tickers: SPCX
Sentiment: Neutral - While Musk is bullish and the company shows strong 33% YoY revenue growth, the stock has declined 45% from its post-IPO high and trades at an extremely elevated 80+ times sales valuation. The massive short position and upcoming earnings report create near-term volatility, but fundamental concerns about profitability and valuation justify a cautious neutral stance pending Aug. 4 results.
Keywords: short selling, SpaceX IPO, short squeeze, earnings report, lock-up expiration, stock valuation, bearish bets
Insights:
- SPCX: Neutral: While Musk is bullish and the company shows strong 33% YoY revenue growth, the stock has declined 45% from its post-IPO high and trades at an extremely elevated 80+ times sales valuation. The massive short position and upcoming earnings report create near-term volatility, but fundamental concerns about profitability and valuation justify a cautious neutral stance pending Aug. 4 results.