SpaceX stock (SPCX) closed near $115 on Wednesday, falling almost 20% below its $135 June listing price. At the same time, SpaceX's long-term corporate 2056 bonds yields rose to record highs of 7.6%. The slide in SpaceX's shares and increase in the cost of its debt has brought back worries that bloated valuations across tech stocks and digital assets are starting to unravel.

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Economist Peter Schiff highlighted the price fall, calling the slide in Elon Musk's space company a warning for other high-value tech stocks and cryptocurrencies.

SpaceX Debt Trades like High-Risk Junk

In June, SpaceX sold $25 billion in debt across five groups at interest rates between 5.35% and 6.65%. Its longest notes due in 2056 fell the hardest, so SpaceX bonds now trade at prices typical for high-risk junk debt.

Investors are now demanding extra return to hold these long SpaceX notes, with risk premiums climbing from 1.75% at launch to over 2.3%. This jump happened after SpaceX posted a $4.28 billion first-quarter loss on $4.69 billion in revenue. Essentially, it has prompted SpaceX's bondholders to ask for higher yields to cover their risk.

Peter Schiff Points to SpaceX as a Warning

Peter Schiff shared the bond numbers online and pointed out that SpaceX stock now sits roughly 48% below its peak of $225.64. He described the drop as a sign of trouble ahead for overvalued tech companies and cryptocurrencies.

Schiff has long argued that credit stress in the bond market will cause the next big market crash rather than crypto. While Schiff's critics note that his past bearish calls have not always played out, this recent drop in SpaceX's stock price and bond values comes as investors grow more cautious.

SpaceX's Upcoming Stock Unlock Is a Worry for Investors

A major stock unlock date arrives in early August, just two days after SpaceX shares its second-quarter earnings report. Roughly 911.5 million shares, worth about $123 billion at recent prices, will become eligible for sale.

Traders are watching this flood of potential new shares alongside SpaceX's spending plans. We don't know right now whether this weakness will spread into digital assets like Bitcoin. Hopefully, we get more clarity once SpaceX's August earnings and stock unlock pass.

Is SpaceX a Good Stock to Buy?

Overall, analysts have a Strong Buy consensus rating on SPCX stock based on 23 Buys, five Holds, and one Sell assigned in the past three months, as indicated by the graphic below. Furthermore, the average 12-month SPCX price target of $243.81 per share implies 111.4% upside potential. (See SPCX stock forecast)