The Federal Aviation Administration has given Virgin Galactic its full commercial launch license following the company’s May test flight. Virgin Galactic customers can go into space. Virgin Galactic was, of course, allowed to operate its spacecrafts. Until now, however, it wasn’t allowed to transport paying passengers.
‘”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 be generating initial sales by the end of 2021.
For now, Wall Street likes Virgin Galactic stock. Six of 10 analysts covering the company rate shares at Buy. The average Buy-rating ratio for stocks in the S&P 500 is about 55%.
But with recent moves, Virgin Galactic has shot by analyst price targets. The average analyst price target among the 10 who cover the stock is $30. The highest target is from Truist analyst Michael Ciarmoli. His price is $50. Virgin Galactic stock traded as high as $55.68 Friday.
Wall Street is either going to have to dramatically increase target prices or downgrade the stock. It’s not typical to have a Buy-rated stock with the implied move, based on the target price, down 50%-plus. That’s the situation a few analysts find themselves in.
Bernstein analyst Douglas Harned, for instance, rates shares Buy but has a $27 price target. He raised his target price is May. It’s been hard to keep up with the stock.
With Friday’s surge, Virgin Galactic stock is now up roughly 131% year to date, although shares are down about 13% from a 52-week high of $62.80 set back in February.
Shares got down to $14.27 in May, after flight-testing delays weighed on investors’ minds. It’s been a wide ride for 2021. Now paying customers get to experience what investors have been going thru on the company’s spaceships.
Write to Al Root at email@example.com