Stock markets managed to overcome pressure early Tuesday morning to move higher an hour into the trading day. Among stock market indexes, the Nasdaq Composite (^IXIC 2.02%) led the way upward, with gains of about half a percent as of 10:30 a.m. ET.
Unfortunately, not all stocks managed to participate in the rally. Virgin Orbit (VORB) suffered significant declines after a mission didn't go as planned. However, another stock, Sotera Health (SHC 0.71%), came close to doubling in value after the company resolved a major issue.
Virgin Orbit deals with a failed launch
Shares of Virgin Orbit were down 16% on Tuesday morning. The company conducted a historic mission from its U.K. launch site, but it failed to achieve everything it set out to accomplish.
Virgin Orbit's Cosmic Girl carrier aircraft took off from the runway at the company's spaceport in Cornwall late Monday night, and it successfully reached its target altitude for releasing the LauncherOne rocket.
After ignition, the rocket reached space and successfully went through its stage-separation sequence. But an anomaly during the second-stage burn led to the premature end to the mission. As a result, the satellites that the Virgin Orbit spacecraft carried failed to reach their intended final orbit.
One problem that Virgin Orbit has faced throughout the past year is a rising level of competition in the industry. Privately held SpaceX has had a number of successful launches, while other companies like Astra Space (ASTR 2.22%) have also managed to make an early impression in providing satellite launch services.
The setback for Virgin Orbit has sent the space stock to all-time lows, and it's down more than 85% from its best levels over the past year. Investors are excited about the prospects for space launches, but it's not clear whether Virgin Orbit will emerge as one of the winners in the increasingly crowded industry.
Sotera makes a deal
Moving the other direction, though, were shares of Sotera Health. A 95% move higher came after the specialist in lab testing and sterilization solutions successfully took steps to resolve what has been a major potential problem hanging over the stock.
Sotera announced that it has agreed to reach settlements regarding a massive number of claims against the company's Sterigenics subsidiary. The cases centered on allegations that emissions of ethylene oxide from a Sterigenics factory caused cancer in the surrounding community. A jury trial of one case rendered a massive $363 million verdict in September 2022 against defendants that included both Sotera and Sterigenics. With hundreds of similar cases, many feared that Sotera wouldn't be able to get past the problems.
Under the terms of the settlement, Sterigenics will pay $408 million in order to settle the more than 870 claims pending against the company. In exchange, plaintiffs will agree to dismiss their claims and not pursue further legal action.
Neither Sotera nor Sterigenics will specifically admit to any liability or safety hazard as part of the settlement, with the company's news release citing "years of biased media coverage in the greater Chicago area" as one reason to settle the claims rather than proceeding to fight what it continues to believe were erroneous claims.
Despite the big gains, Sotera continued to trade below the levels it achieved in early 2022. That suggests that if the company can now move forward with pursuing its business goals without the distraction of litigation, then further gains could be ahead for Sotera shareholders.