Virgin Galactic Stock Tumbles Nearly 20% Even After Good News—Here’s Why


Share post:


After announcing its first commercial voyages to space and seeing a subsequent boost to its stock price, Virgin Galactic’s stock fell 19% Friday morning after SEC filings revealed the company was trying to raise $400 million through sale of common stock.

Key Facts

Virgin Galactic, the company founded by billionaire Richard Branson with the goal of taking wealthy tourists to the edge of space, is trying to finance its spaceship fleet and infrastructure “to scale its commercial operations” as well as “general corporate purpose” through a stock offering, the company reported in SEC filings Thursday.

This sent the company’s stock down nearly a fifth, prompting the most dramatic single-day percentage selloff since January 2022.

The stock drop comes a week before its first commercial space flight, scheduled to take off June 27.

It follows a 44% share price boost after the company announced the space flights last week.

Some experts, including Rupert Steiner and Al Root with Barron’s, point out that as a heavily capital-intensive startup, every time Virgin Galactic’s stock price increases, it’s bound to go back down because the company needs more cash to fund its continued operations.

Big Number

27%. That’s the percentage of the company’s total market capitalization this $400 million fundraise represents as of the market closing Thursday.

Key Background

Virgin Galactic was founded by Branson in 2004 and went public in 2019. Next week, the company will take its first commercial space flight with a group of Italian researchers, the company announced last week. Its second-ever space flight, scheduled for August, will take the company’s first tourists to space. In 2021, the company also turned Branson into the first billionaire to fly to space on his own rocket, launching a new phase in what some have dubbed a “space race” amongst the super wealthy as other billionaires have gotten in on this space craze. Elon Musk founded SpaceX, which contracts with NASA to transport astronauts to the International Space Station and was established with the lofty goal of putting humans on Mars. Meanwhile, Jeff Bezos used his Amazon wealth to create Blue Origin, which took him to the edge of space just slightly over a week after Branson went in 2021.

Forbes Valuation

We estimate Branson’s net worth at $3 billion.


Despite the immediate setback Friday morning, Virgin Galactic’s stock has been thriving this year. Through Thursday, the stock has climbed 52.9% this year. For comparison, the S&P 500 index has seen a 14.1% advance in that time.

Further Reading

Virgin Galactic Plans First Commercial Space Flight This Month (Forbes)

Virgin Galactic stock tumbles after space-tourism company seeks to raise $400 million (MarketWatch)

Source link

Lisa Holden
Lisa Holden
Lisa Holden is a news writer for LinkDaddy News. She writes health, sport, tech, and more. Some of her favorite topics include the latest trends in fitness and wellness, the best ways to use technology to improve your life, and the latest developments in medical research.

Recent posts

Related articles

Stop-gap funding measure to avert US shutdown passes key hurdle

Receive free US politics & policy updatesWe’ll send you a myFT Daily Digest email rounding up the...

Serbia will not send military forces into Kosovo, Vučić insists

Receive free Kosovo updatesWe’ll send you a myFT Daily Digest email rounding up the latest Kosovo news...

Axel Springer expresses interest in buying UK’s Telegraph group

Receive free Telegraph Media Group Ltd updatesWe’ll send you a myFT Daily Digest email rounding up the...

New head of the US military aims to dodge the political fray

A former F-16 pilot who earned the call sign “Swamp Thing” after he ejected into the Florida...

Afghan currency posts world-beating rally in third quarter

Receive free Currencies updatesWe’ll send you a myFT Daily Digest email rounding up the latest Currencies news...

Extreme weather hits lovers of sweet treats in the pocket

Steep rises in the prices of sugar and cocoa are set to hit sweet treat lovers’ wallets...

New EU trade rules could snarl N Ireland supply chains, companies warn

New post-Brexit rules for trade between Britain and Northern Ireland begin to come into force this weekend,...

Revolut attracts UK watchdog scrutiny over red-flag accounts

Receive free Revolut Ltd updatesWe’ll send you a myFT Daily Digest email rounding up the latest Revolut...