Earthmeta Earthmeta

SPCE Stock Dips 13% as Virgin Galactic Chairman Chamath Palihapitiya Sells His Holdings

| Updated
by Steve Muchoki · 3 min read
SPCE Stock Dips 13% as Virgin Galactic Chairman Chamath Palihapitiya Sells His Holdings
Photo: Virgin Galactic / Twitter

Virgin Galactic has had to postpone several space flights prompting SPCE stock investors’ lack of confidence.

Virgin Galactic Holdings Inc (NYSE: SPCE) stock extended yesterday’s dip during Friday’s premarket and is still down after the market opened. According to market data provided by MarketWatch, SPCE stock closed Thursday trading at $30.30, down 5.4%. Meanwhile, they were down approximately 7.49% during Friday’s pre-market and are down 13% at the time of writing.

The dip has been attributed to a decision by Virgin Galactic Chairman Chamath Palihapitiya to sell off 6.2 million shares. According to a post by Bloomberg, Palihapitiya sold his holding in the space-tourism company founded by Richard Branson, raising $213 million.

As a result of the continued dip in the past few weeks, all the gains made last year have drowned. SPCE stock gained approximately 39.82% last year. However, in the past month, they have dropped 44.24%. Similarly, the dip accounted for approximately 18% downslide in the past five days.

Virgin Galactic and SPCE Stock

Virgin Galactic has had to postpone several space flights prompting investors’ lack of confidence. Notably, Virgin Galactic faced public and regulatory scrutiny after one of its planes experienced technical challenges on a flight resulting in the death of one pilot. Over time, the company has had to undertake several flight tests.

Bloomberg also noted that the company has hundreds of customers awaiting a 90-minute flight to the edge of the space. Reportedly, the company has set the price of the 90-minute flight per head at $250,000. The delayed flights have somehow displeased most investors who continue to sell-off. As seen from the decision by Palihapitiya, who is part of the inside management.

However, Palihapitiya still controls 15.8 million SPCE stock, which he owns together with his investment partner Osborne.

SPCE stock investors are also monitoring the ongoing coronavirus pandemic and how it will affect the tourism industry, besides the delayed flights. However, the demand for space flights, which the tickets have been booked for the first several flights, is still high as the industry is still in the early stages.

Palihapitiya and his investment partner Osborne ventured into the Virgin Galactic through a company merger. Notably, the two had a special-purpose acquisition vehicle called Social Capital Hedosophia. It is through the merge of SPAC firm and Virgin Galactic that resulted in the latter becoming the first world’s first publicly traded space-travel venture.

SPCE stock might continue bleeding out to such an extent that if the coronavirus is not tamed earlier enough, the drastic measure could be deployed.

The company has a market capitalization of $7.7 billion, and 234.34 million outstanding shares. Interested shorts amounted to approximately $19.61 million as of February 12. A survey by MarketWatch indicates SPCE stock received an average of Over rating from 9 ratings.

Business News, Market News, News, Stocks, Wall Street
Related Articles