For now, Virgin Galactic stock is soaring

Investors in Virgin Galactic Holdings received a positive shock on Friday, and the stock price soared. In fact, with the jump so high, Wall Street will have to decide whether to ground the stock.

Virgin Galactic (SPCE) shares rose more than 34% in midday trading. The Standard & Poor’s 500 Index and the Dow Jones Industrial Average rose 0.2% and 0.6%, respectively.

After the company’s test flight in May, the Federal Aviation Administration has granted Virgin Galactic a complete commercial launch license. Virgin Galactic customers can enter space. Of course, Virgin Galactic is allowed to operate its spacecraft. However, up to now, the transportation of paying passengers is not allowed.

‘”We’re incredibly pleased with the results of our most recent test flight, which achieved our stated flight-test objectives,” said CEO Michael Colglazier in the company’s news release. “Today’s approval by the FAA of our full commercial launch license, in conjunction with the success of our May 22 test flight, give us confidence as we proceed toward our first fully crewed test flight this summer.”

Wall Street expects Virgin Galactic to achieve initial sales by the end of 2021.

Currently, Wall Street likes Virgin Galactic stock. Six of the 10 analysts rate the company’s stock when buying. The average buy rating ratio for S&P 500 stocks is approximately 55%.

But with the recent move, Virgin Galactic has reached the analyst’s price target. The average target price of 10 analysts covering the stock is $30. The highest goal comes from Truist analyst Michael Ciarmoli. His price is 50 dollars. Virgin Galactic’s share price reached $55.68 on Friday.

Wall Street will either have to substantially increase the target price or downgrade the stock. Based on the target price, the implied trend of buying rated stocks is not common, with a drop of more than 50%. This is the situation some analysts find themselves in.

For example, Bernstein analyst Douglas Harned (Douglas Harned) rated the stock as “buy” but had a target price of $27. His upward target price is May. It is difficult to keep up with inventory.

Following Friday’s surge, Virgin Galactic’s share price has risen about 131% so far this year, although the share price is down about 13% from the 52-week high of $62.80 set in February.

After the test flight delay put pressure on investors, the stock price fell to $14.27 in May. 2021 is a long journey. Now paying customers can experience the investor’s experience on the company’s spacecraft.

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