Why Is Virgin Galactic's Share Price Crashing?
It's been a very turbulent 24 hours for Virgin Galactic after it saw its stock soar and then subsequently crash back down to earth.
Sept. 3, 2021

Back on July 11, Virgin Galactic (NYSE: SPCE) successfully sent Richard Branson to the edge of space on its first manned mission.

Since then though, its share price has plummeted 35%, and now, all of its flights have been grounded by the Federal Aviation Authority (FAA) pending an investigation.

It was all going so well...

There was a point there yesterday where things were really looking up for Virgin Galactic. 

It had just confirmed that its next flight, Unity 23, would be its first commercial research mission, sending scientists and members of the Italian Air Force to the edge of space. Its share price was up 10% by mid-day, and analysts were considering how this move would impact future business in a positive way.

And then, the warning lights flashed.

I'm talking about literal warning lights which a report from Wednesday claimed were flashing on the July 11 mission, believed to be related to the flight veering off course. This story led to Virgin being smacked with an FAA grounding order yesterday. In a statement from the federal body:

"Virgin Galactic may not return the SpaceShipTwo vehicle to flight until the FAA approves the final mishap investigation report or determines the issues related to the mishap do not affect public safety."

The "mishap" in question refers to why Virgin Galactic flew outside of the area for which it was cleared on July 11. It is currently unclear whether there is a correlation between the reported warning lights and the flight's misaligned trajectory, but the investigation will likely clear up any confusion.

It's hard to predict what will become of the inquiry, but investors will be hoping that things get smoothed out before the Unity 23 launch, which was planned for the end of September/early October. 

A successful research mission could result in more lucrative research contracts in the future, helping diversify its currently tourism-focused revenue stream. 

Best keep an eye on this one folks.

If you want to invest in less risky stocks, or other great investment opportunities, check out MyWallSt's shortlist of market-beating stocks. Start your free access now.

The Home of Successful Investing.

© 2023 MyWallSt Ltd. All rights reserved.







This website is operated by MyWallSt Ltd (“MyWallSt”). MyWallSt is a publisher and a technology platform, not a registered broker-dealer or registered investment adviser, and does not provide investment advice. All information provided by MyWallSt Limited is of a general nature for information and education purposes, and you should not construe any such information as investment advice. MyWallSt Limited does not take your specific needs, investment objectives or financial situation into consideration, and any investments mentioned may not be suitable for you. You should always carry out your own independent verification of facts and data before making any investment decisions, as we cannot guarantee the accuracy or completeness of any information we publish and any opinions that we publish may be wrong and may change at any time without notice. If you are unsure of any investment decision you should seek a professional financial advisor. MyWallSt Limited is not a registered investment adviser and we do not provide regulated investment advice or recommendations. MyWallSt Limited is not regulated by the Central Bank of Ireland. MyWallSt Limited may provide hyperlinks to web sites operated by third parties. Your use of third party web sites and content, including without limitation, your use of any information, data, advertising, products, or other materials on or available through such web sites, is at your own risk and is subject to the third parties' terms of use.