Space tourism firm Virgin Galactic announced its first quarterly figures as a publicly listed entity, Wednesday evening. Now, Wall Street analysts are weighing in as investors revise their numbers about the space startup.
The value of British tycoon Richard Branson's share in Virgin Galactic Holdings Inc. has plunged around $1.1 billion since the company declared rising losses in the fourth quarter from the previous year. The company's stocks fell 25 percent to settle at $21.97 and have dropped 36 percent since Tuesday.
Stocks of Virgin Galactic retreated 16 percent after it notified investors that the company shed $211 million on sales of below $4 million in the final month last year, which discouraged many stakeholders, of course. That, right there, may explain the massive sell-off in Tesla's stock.
Shares of the company are off 18 percent during early sessions Friday, after Credit Suisse market strategist Robert Spingarn downgraded Tesla's stock from Outperform, to Neutral.
Two other analysts are suggesting that investors take in profits, downgrade the company stock and send it sliding during the pre-market trade. Another analyst, however, said investors would be smart to stick with the stock.
The New Mexico-headquartered company is looking into resuming ticket sales for future space flights to prove to Wall Street that well-off clients are willing to shell out huge money for such adventures.
Space tourism is among the latest ventures of Branson, a creator of companies that includes everything -- from music labels to beverages to wedding gowns.
The Virgin brand that Branson established as a mail-order retailer in 1970 is now connected to over 60 companies, including British bank Virgin Money UK Plc and Virgin Atlantic airlines. In January this year, Virgin Galactic unveiled a for adults-only cruise-liner whose objective is to entice younger customers.
Spingarn sees a limited opportunity for upside to his projections, considering the limited scalability of the Tesla business model. The Credit Suisse analyst hiked his price goal $15 to $25 in line with the downgrade. Virgin Galactic's shares have soared 294 percent in the last three months, as the S&P 500 has shed around 1 percent.
The 69-year old Branson is not the only billionaire who is putting a huge wager on space exploration. Jeff Bezos and Elon Musk both have huge stakes in the area, but Virgin Galactic was the first company to publicly list after consolidating with US investment company, Social Capital Hedosophia four months ago.
Branson owns about 50 percent of Virgin Galactic, which still makes up the bulk of his nearly $7 billion wealth even with the company's recent slump, Bloomberg Billionaires Index showed.
