Is SpaceX a Buy Right Now While It's Down from Its Peak? Here's My Honest Take.

Space Exploration Technologies' (SPCX +0.98%) stock market debut marked an exciting time for retail investors. The industrial and tech giant earmarked a greater-than-usual percentage of shares for these non-professional investors. And the stock then climbed on its first day of trading and completed its first five days on the market with a 23% increase.

Since, SpaceX has retreated from its peak. In certain cases, this may be as investors lock in profits, but in other cases, it might be a clear rotation out of the stock. After all, SpaceX is an exciting company that offers great potential -- but it also comes with a fair share of risk.

Is SpaceX a buy right now on the dip? Here's my honest take.

The SpaceX story

Let's start off by catching up on the SpaceX story so far. The company actually has been around for quite some time, developing its expertise in the field of rocket launches. Elon Musk, who also leads Tesla, founded the company back in 2002, with the dream of developing cheaper space travel. SpaceX has made significant progress in the area, with more than 85% of its missions flown with one or more reused boosters.

And SpaceX may be on track to reach a big milestone: launching reusable rocket Starship with payloads to orbit in the second half of this year.

You might know SpaceX best for this space business, but the company also has two other units that are key parts of the story. One is Starlink, the satellite-based internet business, and so far, it's the company's revenue growth driver. On $18 billion in revenue last year, Starlink contributed more than $11 billion. The business has greatly grown subscriber numbers from 2.3 million in 2023 to more than 10 million today, and these members span countries worldwide.

The other SpaceX business is the artificial intelligence (AI) arm -- and this is recent, following SpaceX's merger with xAI earlier this year. The AI business brings SpaceX major possibilities, but at the moment, it also brings higher costs. In order to reach goals such as the development of data centers in space, SpaceX must invest heavily. We can see this through the company's financial reports for 2025. Last year, AI capital expenditures reached $12 billion and brought the entire company to a net loss.

A high-growth phase

Musk has said the company is in a high-growth phase, and following its record IPO, which raised more than $85 billion, SpaceX launched an offering of senior unsecured notes to pay off bridge financing and cover certain general-purpose expenses.

Now, let's consider whether SpaceX makes a good buy right now. As mentioned above, SpaceX operates very innovative businesses and has made considerable progress in recent years. It's understandable that an investor looking for the next big tech winner might want to scoop up shares of this company.

But it's important to keep in mind that SpaceX must continue to significantly invest in order to make certain goals possible. And this could make reaching profitability very difficult. How long will this phase last? It's impossible to say, but considering that we're in the early stages of the AI build-out, SpaceX might focus more on investing in growth than on securing lasting profitability right now.

SpaceX's reliance on new technology

It's also key to remember that SpaceX depends heavily on new technology. If certain technologies don't deliver, the company may not reach certain goals, and this could weigh on earnings potential down the road.

So two key risks are: SpaceX is spending heavily, and this may delay profitability, at least for a while. And any potential technology setback might keep the company from accomplishing all that investors expect. It's important to feel comfortable with these points before considering SpaceX stock.

In my honest opinion, though SpaceX is an interesting growth company, I don't think investors should rush to buy the stock -- even on the dip we're seeing now. Instead, I think it's a better idea to take a look at the company's upcoming earnings reports and consider how its investments are translating into growth. There may be plenty of other opportunities to buy SpaceX on the dip down the road.