What’s the Risk with SpaceX?

A United Methodist Insight Special | June 18, 2026

United Methodist investors who don’t participate in Wespath, the denomination’s pensions and benefits agency, might want to think twice before buying SpaceX stock, according to business experts.

The Big Picture, an independent online news journal, described the potential volatility of SpaceX investment by explaining traditional safeguards that Nasdaq relaxed to get Elon Musk’s company as part of its market.

Writer Jay Kuo outlined three historic guards:

When a company offers its shares to the public for the first time, the process is normally carefully regulated. Those regulations weren’t invented to make things difficult; they were invented to protect investors.

The seasoning requirement. Under longstanding rules, a company generally has to have been publicly trading for at least 12 months before it could join a major stock index. The idea is simple: Give the market time to breathe and see how a newly public company actually behaves before folding it into the indexes that anchor most Americans’ retirement savings.

The profitability requirement. To join the S&P 500, a company traditionally had to demonstrate four consecutive quarters of positive earnings under standard accounting rules. If a company is losing money, it shouldn’t automatically join the index that millions of people depend on for their financial futures.

The float requirement. Most major indexes required that at least 5 to 10 percent of a company’s shares be available for public trading. A very small “float”—meaning very few shares actually changing hands—makes a stock vulnerable to extreme price swings, which puts the pension funds and 401(k) plans that must buy in at risk.

The SpaceX arrangement, as currently constituted, fails all three tests. It will join major stock indexes long before it has “seasoned” for a year. Per CNBC, it recorded a $4.28 billion net loss in the first quarter of 2026 alone, not the positive earnings normally required, and will go public with a float estimated at just 3 to 5 percent. As Caleb Ecarma noted in Oligarch Watch, companies with market caps comparable to SpaceX’s target, such as Amazon, Nvidia and Microsoft, float more than 90 percent of their shares.

Wespath joined 16 others on the Council of Institutional Investors to raise objections to SpaceX’s governance structure in a June 9 letter to Elon Musk and SpaceX board of directors (see accompanying article). SpaceX’s IPO still went forward June 12 without any of the changes the council requested to protect investors.

– Cynthia B. Astle