What happened

Shares of Virgin Galactic (SPCE 7.88%), which dropped 7% off a recent high yesterday, have turned things around and are rocketing once again, up 12.1% at 12:10 p.m. EST on Friday. But are Reddit traders driving the action today, or is there real news behind the rally? Maybe a bit of both.

Virgin Orbit Cosmic Girl Deploying LauncherOne.

Image source: Virgin Orbit.

So what

There does in fact appear to be a WallStreetBeats aspect to this story, inasmuch as traders following the popular Reddit page have indeed been targeting heavily shorted stocks of late, buying them in hope of squeezing the shares higher. Earlier this week, Virgin Galactic shares (of which 16.5% have been sold short) were identified as benefiting from the phenomenon. And on Twitter today, a smattering of traders are continuing to talk up the stock.

At the same time, momentum traders may be getting an assist in their efforts from some news just out from Virgin Galactic's sister company, Virgin Orbit, which completed its first successful satellite deployment from a midair rocket launch earlier this month. As reported today (also on Twitter), Virgin has signed a contract to launch a satellite for the Dutch Ministry of Defense in March.

Now what

But here's what investors need to remember: Yes, today's announcement is further evidence that Virgin Orbit is growing its business, and probably its VOX defense business in particular (VOX being the subsidiary designated for experimental military missions). But Virgin Orbit is not Virgin Galactic. These are two separate companies, albeit they share a parent company in Virgin.com Limited, as S&P Global Market Intelligence confirms.

And while it's also true that Virgin Orbit may be headed for an IPO, as has been rumored, and it's also likely that continued success in rocket launches would make the IPO more attractive, even such an event would benefit privately held Virgin.com rather than publicly traded Virgin Galactic.

The one must not be confused with the other.