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Virgin Galactic stock dropped over 7% in the pre-market after the venture published its Q4 2019 results. The company did not meet the Wall Street’s expectations.
Virgin Galactic Holdings (NYSE: SPCE), a space tourism company, has long stayed the winner in the extremely unstable market conditions. But following other tech companies, it has also admitted its defeat. While the whole market was in red, Virgin Galactic stock was rising. However, the soaring lasted until the company published its Q4 2019 results.
Virgin Galactic (SPCE) stock reported revenue of $529,000, which is far from Wall Street’s prediction of $1 million. In comparison, the revenue for the same period of last year was 58.99% higher. In addition, the company’s net loss for the fourth quarter of 2019 made up $73 million, which is 60.85% wider year-over-year from $46 million before.
Virgin Galactic stock price was quick to react to the report. During after-hours trading on Tuesday, the company’s shares dropped by 5%.
Earlier, Morgan Stanley analyst Adam Jonas stated that Virgin Galactic stock needed “modest correction” which is “overdue and, frankly, healthy.” Probably, the drop marks this correction. Morgan Stanley’s current price target for Virgin Galactic is $22 per share. However, the stock price has spiked to about $40 several times in recent weeks. Besides, shares rocketed 200% higher this year.
Yesterday, Virgin Galactic shares closed at $34.04. Today, pre-market sales started at $32.20. The venture’s market cap is $6.672 billion. The current price is around $31.80.
Virgin Galactic to Resume Ticket Sales
Despite underperforming the results predicted, Virgin Galactic executives stay optimistic about the company’s activity.
George Whitesides, Virgin Galactic CEO, stated:
“Throughout 2019, we continued to achieve key milestones in our mission to open access to space in a safe, innovative and affordable way. During the fourth quarter, we took major steps toward reaching that goal by completing our transaction with Social Capital Hedosophia and becoming publicly listed on the NYSE, as well as building operational readiness at Spaceport America in New Mexico.”
He further added:
“The progress we made in 2019, combined with the high level of interest from potential customers, underpin the steps we are taking toward reopening ticket sales. We are continuing to build on our strong momentum as we enter the most exciting chapter of our story to date and prepare for commercial launch.”
Publishing the Q4 219 results the company has also announced resuming ticket sales for future space flights.
Virgin Galactic suspended ticket sales for rides on SpaceShipTwo in December 2018. But starting today, the company takes $1,000 refundable deposits. The full price of the tickets is not yet known. Previously, the price for the unique flight experience was $250,000. Before December 2018, the company had more than 600 firm reservations from customers in 60 countries.