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Why Virgin Galactic Bounced Again Today

By Rich Smith - May 18, 2021 at 3:07PM

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In a twist, Virgin Galactic seems to be rooting for Blue Origin to beat it to space.

What happened

Shares of space tourism pioneer Virgin Galactic (SPCE -0.57%) stock jumped 6.6% through 2 p.m. EDT trading Tuesday as rumors of an imminent flight test of its VSS Unity spaceplane began to firm up.

In an after-hours column, Investor's Business Daily (IBD) confirmed yesterday that Virgin Galactic "will provide an update on its test flight schedule this week."  

VMS Eve and VSS Unity flying over water.

Image source: Virgin Galactic.

So what

Sketching out Virgin's plans, IBD reminded investors that Virgin has at least four more flight tests on its schedule before it begins accepting paying passengers onboard its spaceplane. First will be the crewed but passenger-less flight test promised to take place in May. A second test will then take place, also with no passengers aboard and no firm date yet set.

Then, Sir Richard Branson will personally test the spaceplane. (No date for this flight has yet been announced.) Finally, Virgin will run a mission in cooperation with the Italian Air Force. Only then will the company begin commercial space tourism operations.

Now what

Granted, that all sounds like it could take some time to wrap up. Indeed, most analysts following the company now believe Virgin Galactic won't begin commercial space tourism operations before 2022 at the earliest. By this time, Blue Origin almost certainly will have completed one or more commercial space tourism flights aboard its New Shepard rocket.

Still, turning lemons into lemonade, in a statement Monday Virgin Galactic was quoted saying it is actually "really important" that Blue Origin succeed -- even if it means Virgin loses the race to be first in this market -- because successful launches by Blue will "normalize the idea of human spaceflight to the market," encouraging more customers to buy tickets from Virgin Galactic as well.

I suppose that's one way to look at it.

Rich Smith has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Virgin Galactic Holdings Inc. The Motley Fool has a disclosure policy.

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