Virgin Galactic is an American spaceflight company within the Virgin Group. It is developing commercial spacecrafts and is looking to provide suborbital space flights to space tourists. Virgin Galactic's suborbital spacecraft are air launched from beneath a carrier airplane known as White Knight Two.
The company's successful test flight to the edge of space has helped to get its stock climbing again, its shares shot up more than 27.74% in today's trading session as the flight was successful. The flight carried two pilots to an altitude of 55.45 miles, positioning Virgin Galactic to begin launching paying customers within the next year, the 50-mile mark is considered to be where the earth's atmosphere ends and space begins.
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News that it planned the flight had already started to lift Virgin Galactic's recently battered shares. After reaching a record price of $62.80 on February 4, the share price slid steadily, hitting a low of $15.05 on May 13. Even with the nearly 70% rebound off that low, shares are still firmly in bear market territory.
Bank of America aerospace analyst Ron Epstein trimmed his price target on Virgin Galactic shares to $41 from $50 Monday, to reflect its recent volatility. But with the stock trading at just more than $25 a share, that price target justifies keeping his buy recommendation on the stock, he said.
The fact that competitors, such as Elon Musk's SpaceX and Amazon founder Jeff Bezos' Blue Origin space tourism company, are not publicly traded gives Virgin Galactic one of the few opportunities for investors who want to get into the sector.
Shares had struggled partly because of delays in performing test flights. But they also took a large hit in March after Chamath Palihapitiya, the company's chairman, disclosed he had dumped his personal $200 million stake in the company.
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