A SpaceX rocket exploded on a launch pad in Cape Canaveral on Thursday morning, destroying the rocket and the satellite it was carrying. According to SpaceX, the explosion was an “anomaly” and there were no injuries involved.
While SpaceX is a private company, the impact of the explosion has certainly hit Wall Street. Shares of SpaceX CEO Elon Musk’s other company, Tesla Motors Inc TSLA 1.46%, were falling 4.4 percent in the wake of the news.
While Tesla and SpaceX have no business connection outside of Musk, traders may see the explosion as a blemish on Musk’s reputation for quality. Despite the fact that Tesla has reported net operating losses for 14 consecutive quarters, hasn’t generated positive cash flow since 2014 and hasn’t shipped more than 50,000 vehicles in a full year, the stock currently has a $30.5 billion market cap. Much of this lofty valuation comes from investors betting on Musk’s reputation and ability to deliver quality products.
Some traders are also concerned that the SpaceX disaster might be a distraction for Musk during a critical time for Tesla. However, Global Equities Research analyst Trip Chowdhry says…
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