By Syndication Washington Post, Bloomberg · Justin Bachman · BUSINESS, TECHNOLOGY
The company, founded by entrepreneur Richard Branson, plans to welcome its initial customers later this year in New Mexico for its first commercial flight.
Investors are also betting that Virgin Galactic will be one of the first companies to offer point-to-point hypersonic travel, one day potentially reducing intercontinental flights to less than three hours. In a December report, Morgan Stanley analysts valued that market at $800 billion by 2040, dwarfing the space tourism business.
Virgin announced last week that its second commercial ship had reached a "weight on wheels" assembly milestone considerably faster than it took to get to the same stage with its first spaceship. Work on a third ship has begun, the company said.
Virgin Galactic aims to have five spacecraft in service by the end of 2023 operating from its base at Spaceport America in southern New Mexico.
On Wednesday, the company named Enrico Palermo as its chief operating officer. Palermo was president of its manufacturing unit, The Spaceship Co.
Virgin Galactic rose 1.4% to $15.05 at 1:32 p.m. Thursday in trading on the Nasdaq.
The company debuted on the public markets on Oct. 28 and rose to more than $12 before dipping to a low of $7.22 in late November. The stock began rising again in mid-December, finishing the year at $11.55. Morgan Stanley assigned a $22 target price for the shares on Dec. 19.
The jump last month came after the management team made the rounds of analysts to tell its story, Alex King, founder of Cestrian Capital Research, wrote in a Jan. 13 note. King owns Virgin Galactic shares personally.
In November, Virgin reported losing about $128 million for the period through Sept. 30. He labeled the stock "speculative" given the company's early stage. Virgin Galactic has raised more than $1 billion since it was founded in 2004, initially from Branson, with an Abu Dhabi investment company taking a stake in 2010.