What happened

Virgin Galactic Holdings (SPCE 7.45%) shares fell 17.7% in March, according to data provided by S&P Global Market Intelligence, weighed down by news a prominent shareholder was selling down his stake. This is a stock that moves more on emotion than fundamentals, and sentiment was more negative than positive during the month.

So what

The month started off sour for Virgin Galactic investors, who got word that company chairman Chamath Palihapitiya had sold a significant portion of his holdings. It also lost chief space officer George Whitesides, a well-respected former NASA chief of staff, who left to pursue other opportunities.

The Virgin spacecraft with its ferry plane.

Image source: Virgin Galactic.

The news continued a bad run for Virgin Galactic, which saw its goal to begin its space tourism service in 2020 come and go due to pandemic-related testing complications and some failed test flights. The company expects to launch service this year, but has experienced some delays in its testing schedule.

Investors have mostly brushed off the setbacks, mindful that space is complicated and some impediments are to be expected. But in March, some of the momentum that has supported growth stocks like Virgin Galactic disappeared, contributing to the decline in the company's share price.

Now what

Virgin Galactic has taken investors on a wild ride, and it is important not to get too caught up on one month's results. The stock is still a double since the company went public, and it still has fans. In March, Truist analyst Michael Ciarmoli initiated coverage on Virgin Galactic with a buy, saying the company is "uniquely positioned to capture share in the emerging commercial space tourism industry."

Maybe so, but it has to get those tourists in to orbit first. Once that happens it will be easier to judge the company based on the merits of the business, including its per-launch cost and the actual demand for its service. Until then, expect a lot more turbulence from Virgin Galactic shares.