Virgin Galactic Holdings ( (SPCE) ) has fallen by -20.10%. Read on to learn why.
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Virgin Galactic Holdings has experienced a significant stock price decline of 20.10% over the past week, reflecting investor concerns and analyst ratings. The company’s stock has been under pressure due to a series of analyst reports, including a maintained ‘Sell’ rating from Morgan Stanley, which also lowered its price target to $2.50 from $5. This downgrade was influenced by delays in Virgin Galactic’s commercial spaceflight program, now expected to launch in 2026 instead of the previously anticipated summer timeline.
The company’s recent earnings call highlighted both progress and challenges. While Virgin Galactic has made strides in spaceship production and cost management, it continues to face hurdles such as production delays and negative cash flow. The company reported a 34% reduction in operating expenses year-over-year, yet free cash flow remained negative at $114 million for the second quarter. These financial challenges, coupled with material science issues in production, have contributed to the stock’s downward movement.
Despite these setbacks, some analysts remain optimistic about Virgin Galactic’s long-term potential. The company holds a strong cash position of over $0.5 billion, which is expected to support its future investments. Analysts like Oliver Chen from TD Cowen maintain a ‘Buy’ rating, citing the company’s strategic planning and potential revenue from its Delta Class Spaceships. However, the near-term outlook remains cautious as investors await clearer catalysts for growth.