What happened

Pity early investors in the space race -- and in Virgin Galactic Holdings (NYSE:SPCE). Despite winning its second Wall Street buy recommendation Thursday morning, Virgin stock's tailspin continues, and the shares are down 12% as of 12:45 p.m. EST on Friday.  

The question is: Why?

WhiteKnightTwo aircraft carrying SpaceShipTwo spaceplane

Virgin Galactic's craft that will carry travelers to the edge of space. Image source: Virgin Galactic.

So what

Marketed by its founder, Sir Richard Branson, as a way for individual investors to "dabble a little bit in a spaceship company, own a little bit of a spaceship company," Virgin Galactic stock has instead turned into a way for investors to lose a lot of money in a hurry. Since reporting its first set of financial results as a merged company two weeks ago, Virgin stock has lost an astonishing 27% of its market capitalization -- and counting.  

Thursday, analysts at investment bank Credit Suisse endorsed the stock as a first mover in the space race, arguing that the high price Virgin will command for flying tourists to the edge of space will enable strong profit margins initially, while also permitting demand to surge if the company reduces its prices.

Now what

Investors, however, aren't persuaded -- and perhaps rightly so. When Virgin reported its fiscal Q3 2019 earnings last week, the company had little positive to talk about other than the shifting of resources toward its planned base of operations, Spaceport America, in New Mexico; the accumulation of "more than 600 people in 60 countries" reserving seats aboard its spacecraft, and "3,557 expressions of interest" in future flights.

In terms of financial numbers, though, the most Virgin could say was that it had booked $3.3 million in revenue year to date, and amassed $138.1 million in losses for its trouble.  

Until it can goose at least that revenue number higher, Virgin Galactic remains a show-me stock.