THE BIG IDEA
You may have heard: SpaceX is issuing shares to the public in the coming days. It will have the ticker symbol SPCX. Whatever you have heard about it is most probably negative or involving some controversy.
Here are the highlights:
SpaceX decided for itself what the offering price per share will be instead of following the normal process of leaving it up to Wall Street bankers.
Many analysts have stated that the company is overvalued based on the offering price and/or too risky of a venture.
SpaceX has tried to force its way into being included in popular indexes, which would then compel ETFs and mutual funds based on those indexes to buy shares.
Only a small percentage of the company is being offered to the public. Elon Musk will still be in full control, for better or worse.
There is much not to like here, right?
The thing is, we have seen this movie before.
A generation ago, an upstart company called Google tried to break the rules for IPOs. Wall Street was not pleased. Some firms even boycotted from participating in the process.
At that time, I happened to work in the private client group of one of the Wall Street firms. I had daily contact with the equity research sales team, whose job was to inform the firm’s financial advisors about the current thinking of the research department.
Nobody was running around yelling “this Google IPO is going to make us look bad!”. But there was unmistakable negativity surrounding it, both internally and externally.
What was the problem?
Google had the temerity to want the market to decide its IPO price instead of leaving it in the hands of Wall Street bankers. (Hint: the bankers don’t set the price to benefit the issuer of shares.)
Instead of the traditional process, Google chose a Dutch auction — a system designed to let regular investors bid directly and force the price to reflect actual demand.
Seeing the threat to their business model, Wall Street set out to stain, by way of a friendly financial media, everything about the IPO.
The media portrayed the Dutch auction approach as confusing and risky. At the same time, it was discovered that Google failed to properly register some shares previously awarded to employees, prompting an SEC inquiry (scandal!!!). The founders themselves were heavily criticized for doing an interview with Playboy, published shortly before the IPO.
And Wall Street won.
Google initially expected to price their shares in a range of $106–$135, but due to weak demand and negative sentiment, the offering was ultimately priced at $85. This was even after the company was forced to reduce the number of shares it would issue.
So, fewer shares sold and at a lower price.
Google share price since 2004 IPO
Yet, on the first day of trading on August 19, 2004 the stock opened at $100.01 and finished the day at $100.34.
It was an immediate profit for anyone who got shares during the IPO process. Buyers during that first day of trading also did well. GOOG finished the year at $190. It doubled again from there the following year.
And now, 22 years later, history is repeating itself. Or trying to.
Despite Wall Street’s best efforts, demand for SpaceX shares is rumored to be multiple times the number being offered. So much for being overpriced.
Not only that, but SpaceX was able to negotiate cut-rate fees for the Street’s services. Instead of boycotting, now everyone is desperate to be involved.
It isn’t 2004 anymore.
SEEN ON THE INTERNETS
Hey, the market had a wipeout of a day on Friday.
Many people expected it to come (but when?). However, Substack writer Jor’El Jones had an interesting take on the situation.
He noted that the market is only 3% off its all-time highs and yet there is a state of FEAR among investors. (He is referring to the CNN Fear & Greed Index, though it isn’t clear from his post.)
The bulk of his note was about bear markets not necessarily being a bad thing and listed the gains for each of the Magnificent 7 stocks since the last bear market. Nvidia up 2079%!
We agree with him that it is surprising to have so much negativity so close to all-time highs. To go down to a meaningful bottom, we will need to fall into “Extreme Fear” first.
NUMBERS ONLY
- 9.22% | The popular VanEck Semiconductor ETF plunged 9.22% on Friday, all the way down to where it was… two weeks ago. |
18 | Despite Friday’s selloff, 18 stocks in the S&P 500 reached a 52-week high. Many of them are connected to finance or real estate. |
4.999% | Higher interest rates on U.S. government debt, like the almost 5% on a 30-year bond, seem to be the spark that lit the stock market’s bonfire on Friday. |
SWINGEX INDEX
As of market close on: 5 June 2026
Swingy says: At times like this, do something to get away from the market. I play pickleball!
Learn more about how the Swingex Index works here.
WATCHER
Stocks highlighted here each week are not recommendations to buy or sell. They are provided as ideas for swing traders to follow up on with their own research.
PBI last 3 months
PBI (Pitney Bowes): Last week’s Prime Wave highlighted a number of companies from yesteryear having their day in the sun. This week, our Watcher stock is another name from the past worth taking a look at.
You might have forgot that Pitney Bowes still existed, or maybe you never even heard of it before. Nevertheless, the stock has been on a roll since hitting bottom at $2 back in the fall of 2022.
PBI spent most of the past year hanging around the $10 area before jumping to $15 in April. It spent a month forming a base in the $15-16 range and now may be ready for another leg up.
The shares didn’t cave with the majority of the market on Friday and that can be viewed as a sign of underlying strength.