SpaceX (NASDAQ:SPCX) investors had another difficult day on Wednesday after the stock fell nearly 7%, extending the post-IPO selloff and leaving shares about 15% below their offering price. The selling appears to reflect growing caution ahead of the company's first earnings report as a public company, concerns over a looming insider lock-up expiration that could significantly expand the stock's float, and skepticism that the company's valuation already prices in years of successful execution.

Claim 55% Off TipRanks

High conviction on SPCX? Try Tradr's SPCM or SPCG

With the stock continuing to retreat, has this created an attractive buying opportunity?

Investor John Engle does not think so, arguing there are simply "too many miracles priced in already."

That opinion does not come from someone dismissing what SpaceX has accomplished. Engle describes the company as one of America's great industrial innovators after transforming commercial launches, pioneering reusable rockets, and turning Starlink into the world's leading low-Earth-orbit satellite network. Those achievements deserve recognition, yet the investor believes the market has gone much further by assigning premium valuations to businesses and technologies that still have plenty left to prove.

According to Engle, "The bull case for SpaceX essentially boils down to a chain of dependent assumptions." The investor believes today's valuation already assumes successful execution in several areas that remain uncertain, including Starship becoming a commercially viable launch platform, AI infrastructure producing attractive long-term returns, and orbital computing eventually developing into a meaningful business.

Starship sits near the top of that list. While Falcon 9 has already established itself as a dependable launch vehicle, Engle argues investors are paying primarily for what Starship could become rather than what it has demonstrated so far. Commercial payload launches, frequent reusability, and dramatically lower launch costs remain goals rather than established realities, making today's valuation difficult to justify from his perspective.

His concerns extend well beyond the launch business. SpaceX continues producing strong revenue growth, yet spending has climbed much faster as billions flow into Starship development, AI infrastructure, and Starlink expansion. Engle writes that "the company's appetite for capital remains nigh insatiable," leaving investors dependent on future breakthroughs to justify today's spending levels.

Ironically, Engle believes the company's strongest business receives far less credit than it deserves. The investor calls Starlink "by far the most convincing part of the SpaceX investment story," pointing to its profitable connectivity business and clear path for continued expansion. Unfortunately, he remains unconvinced that Starlink alone cannot support the company's trillion-dollar valuation. Instead, investors are placing far greater value on AI computing, Starship, and other long-term projects that still face meaningful technological, commercial, and regulatory hurdles.

For Engle, the investment case ultimately comes down to whether those lofty expectations become reality. He argues investors buying the stock today are "prepaying for multiple, successive technological breakthroughs and the attendant market revolutions" that may take many years to arrive, assuming they arrive at all.

That leads him to a very bearish conclusion: "Taken together, it is my studied opinion that SpaceX's risk-reward profile remains deeply unattractive. He closes with an even stronger assessment, arguing "SpaceX is a massively overpriced company with an unclear future being held up by profoundly overinflated expectations," leaving him convinced that buying this dip remains a risky proposition.

Unsurprisingly, Engle assigns SpaceX shares a Strong Sell rating. (To watch Engle's track record, click here)

Wall Street, however, would agree to disagree. The stock currently earns a Strong Buy consensus rating based on 23 Buys, 5 Holds, and 1 Sell. Analysts also see solid upside ahead, with an average 12-month price target of $243.81, implying potential gains of about 111% from current levels. (See SPCX stock forecast)