It's hard to judge a company like Virgin Galactic Holdings (SPCE -5.41%) based on what it is today. The company has little to no revenue and is still in the testing phase of its spacecraft development, and we have no idea what revenue or margins will look like as the company matures. 

But sometimes taking a risk is worth it for investors, and given a multibillion-dollar market potential, Virgin Galactic may be worth betting on. 

Concept drawing of Virgin Galactic Mach 3 aircraft.

Image source: Virgin Galactic.

What Virgin Galactic is building

There are two main products that we know Virgin Galactic is developing. The first is the VSS Unity shuttle, which will take customers on space tourism flights that can cost up to $250,000 per ticket. That sounds like a high price, but there's high demand with around 600 future space travelers signed up and $83.2 million in customer deposits already booked -- all before Virgin launches its first commercial flight.

The second product is expected to be a Mach 3 aircraft that will fly between nine and 19 people at 60,000 feet. The aircraft is still in the design phase, but if it reaches production it could become a valuable ticket, reducing the travel time from Los Angeles to Tokyo from 12 hours to three or four hours. A trip from New York to London could be just two and a half hours

Space tourism and high-speed travel could end up being lucrative businesses if Virgin Galactic can get commercial operations off the ground. 

The multibillion-dollar opportunity

In a recent presentation to investors, management said it forecasts as many as 400 flights per year from each spaceport with revenue per location reaching $1 billion. Right now, the company has just one Spaceport, but in the future, it could have many around the globe. This gives you an idea of how much potential management sees in the business. 

In addition to revenue from passengers, Virgin Galactic is also already generating revenue from deals with NASA, which is using payloads on commercial flights for advanced technology testing. An agreement reached in November will generate $45 million in value for Virgin Galactic.

This doesn't even account for the potential in mach-speed travel, which is still years from reaching reality. Space tourism could be a multibillion-dollar business and could justify what investors are paying for in this $5.6 billion company. Mach-speed passenger travel is just icing on the cake. 

Is Virgin Galactic a buy? 

It's been decades since air travel was truly disrupted, and no one has brought space travel to the masses. Even if we don't know the earning potential for Virgin Galactic in the long term, I like the market it's creating and the traction it already has signing up customers. 

If test flights in the next few months go well, we could see paying customers launch from Virgin Galactic's Spaceport America in New Mexico as early as next quarter, which would open up a whole new phase of the company's growth. I think a few years from now space flight will be commonplace and Virgin Galactic will be leading the way. That alone makes this stock a buy in my eyes, and if it's successful in building a Mach 3 aircraft, it would only provide more upside. 

This is no ordinary airline stock. Given the potential to create a massive new market for experiences and high-speed travel, this is a great buy and a stock I'll look to add to in 2021.