Virgin Galactic shares on Monday fell after the company registered to put on sale $500 million in common stock. This came after the founder Sir Richard Branson’s test flight was a success.
The commercial spaceflight company slipped 17.3 percent following its filing with the Securities and Exchange Commission of a notice of its stock sale offering. The volatility has caused Virgin Galactic trading to temporarily hitch on Monday.
The company held 240 million shares outstanding. Out of this, 164.6 million are considered float or are open to the public for trading. Virgin’s $500 million offerings, if based on Friday’s closing price of $49.20, is equal to about 10.2 million shares.
The company on Sunday marked a huge milestone after it completed its first fully crewed test flight into space, as it targets to have commercial service next year.
On Monday, the stock closed at $40.69 per share following its increase of up to 7 percent in premarket trading. This year, the stock is up more than 80 percent in expectancy of this progress for commercial service goals.
“We view Branson’s achievement as a massive marketing coup for Virgin Galactic that will be impossible for the public to ignore,” Ken Herbert, Canaccord Genuity equity analyst, told clients.
Aboard commercial spacecraft company’s VSS Unity was Branson along with the three Virgin Galactic employees. VSS Unity was guided by two pilots and it was launched into the skies above New Mexico. It released its rocket engine and sped up, surpassing the speed of sound by three folds, CNBC reported.
“We see this as important on the path toward starting passenger flights, which we assume will happen in early 2022,” Douglas Harned, AB Bernstein analyst, told clients.
