Virgin Galactic Announces First Fully Crewed Spaceflight; Shares Soar 4%

Virgin Galactic Holdings, Inc. (SPCE) announced plans to send a fully crewed test flight of its SpaceShipTwo Unity to space. The test flight window opens July 11, subject to weather and technical checks. This will be its twenty-second test flight, and the crew includes two pilots and four mission specialists, including the company’s founder Sir Richard Branson. Following the announcement, shares of the spaceflight company closed up 4.1% at $44.94 on July 2. (See Virgin Galactic stock charts on TipRanks)

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Branson’s Virgin Galactic and Jeff Bezos’ Blue Origin have been competing against each other to become the first to move into commercial space travel. Sir Branson will take the top spot if the July 11 space flight takes off as scheduled, just 9 days before Bezos takes off on Blue Origin’s New Shepard on July 20.

The “Unity 22” mission will center on cabin and customer experience objectives. The crew will be assessing the cabin’s environment, seat comfort, weightless experience, and views of Earth.

Additionally, the crew will test the conditions for conducting human-tended research experiments and confirm the viability of the training program at Spaceport America.

There will also be a live stream of the spaceflight for the first time, which will be available to watch on Virgin Galactic.com, and simulcast on the Virgin Galactic Twitter, YouTube, and Facebook channels.

The team will undertake inspections of the vehicles and an in-depth data review after the flight. This will inform the next steps in the test flight program.

The company intends to carry out two more test flights before launching its commercial services in 2022.

Michael Colglazier, CEO of the company said, “Tapping into Sir Richard’s expertise and long history of creating amazing customer experiences will be invaluable as we work to open the wonder of space travel and create awe-inspiring journeys for our customers.”

Sir Richard Branson said, “After more than 16 years of research, engineering, and testing, Virgin Galactic stands at the vanguard of a new commercial space industry, which is set to open space to humankind and change the world for good.”

Last week BofA Securities analyst Ronald Epstein downgraded the stock to a Sell and assigned a price target of $41 (8.8% downside potential).

Epstein said in an investor’s note, “We continue to see Virgin Galactic as a beneficiary of the new commercial space race. However, we believe this premium is already priced into the stock and will dwindle as more commercial space companies go public.”

The stock has a Moderate Buy consensus rating based on 4 Buys, 5 Holds, and 1 Sell. The average Virgin Galactic price target of $29.40 implies 34.6% downside potential to current levels. Shares have gained 165% over the past year.