SpaceX public float could triple as earnings and lockup test shares

SpaceX’s public float could triple this week, according to an assessment relayed by 24/7 Wall St., but that does not mean Wall Street expects the stock price to rise 200%. The estimate concerns the number of shares available for public trading, a supply change that can affect a volatile stock as SpaceX reports earnings and its insider lockup begins to expire.

SpaceX was scheduled to release its first quarterly results since its June initial public offering after Tuesday’s market close, CNBC reported. Two days later, a lockup period restricting sales by certain insiders was set to open, adding another event for shareholders to watch.

Why could SpaceX’s public float triple?

A public float is the portion of a company’s shares that investors can generally trade in the open market. A lockup prevents specified early investors and insiders from selling for a set period after an IPO. When that restriction ends, more shares become eligible for sale, although eligibility does not mean holders will sell them.

CNBC’s Morgan Brennan, as cited by 24/7 Wall St., said 911 million shares held by roughly 20% of insiders would become eligible to sell. The IPO had sold 629 million shares, or less than 5% of shares outstanding, according to that report. Brennan’s assessment was that staggered unlocks through September could triple the public float overall.

The figures and timing have not been independently confirmed here through a company filing, prospectus or lockup agreement. Investors should also separate an increase in tradable supply from the company’s total shares outstanding. The lockup does not create new shares, and it does not require insider selling.

More available stock can change the balance between buyers and sellers, especially when the initial number of freely tradable shares is relatively small. It is one reason lockup expirations can add uncertainty after an IPO, alongside the company’s financial results and outlook.

What do SpaceX options say about this week?

Options activity has added a separate, easily misunderstood signal. CNBC found more than 450,000 open positions in SpaceX calls with a $330 strike price expiring Friday, at least seven times the open interest in the next most popular contract. SpaceX was trading at $116.91 in the CNBC excerpt, putting that strike at nearly three times the share price.

A call option gives its buyer the right to purchase shares at a fixed price before expiration. It can be used to bet on a rise, but it can also be used as insurance against a different position. Brent Kochuba, founder of options-flow platform SpotGamma, told CNBC that the purchases were more likely held by banks as a hedge, possibly tied to structured products or short exposure, than by retail traders, hedge funds or market makers.

SpotGamma data cited by CNBC showed roughly 90,000 purchases of the $330 calls on Monday, totaling about $2.2 million. Tidal Financial Group chief trading officer Jay Pestrichelli told CNBC that, depending on assumptions, a roughly $100 rally by Wednesday morning could make the contracts profitable. He described the trade as a lower-cost hedge rather than a straightforward speculative wager.

CNBC said SpaceX options implied a 14% move around Tuesday’s earnings. That expectation, the lockup schedule and unusual options positioning point to a high-uncertainty week, not a confirmed forecast for a tripling share price.

This story draws on original reporting from CNBC.