Chamath Palihapitiya-backed Virgin Galactic extends 2-day rally to 21% amid heightened social-media chatter around its upcoming rocket launch
- Shares of space tourism company Virgin Galactic have climbed 21% in just two days ahead of the company's planned flight Saturday.
- Social media chatter on the company has increased 928%, Hype Equity data shows.
- Redditors are mixed on whether the shares were set to plummet or rocket.
Virgin Galactic shares rallied sharply for a second straight day on Friday amid mounting social-media chatter around the company's planned rocket launch Saturday.
The climbed as much as 5% in early trading, extending its two-day surge to 21%.
SPCE has seen a 928% increase in social interest since Wednesday night, with most of the chatter surrounding the flight test, according to social tracking data from Hype Equity.
On Reddit thread Wall Street Bets, sentiment on the stock has been mixed.
One account said the company was "setting themselves up to fail this weekend" on account of poor weather conditions and past flight delays and failures. Others took a more optimistic view. One said the stock is "about to rocket," a reference to shares rallying. The post was upvoted 81%.
On top of increased social media chatter, shares got a boost from UBS analyst Myles Walton, who upgraded the stock to buy from neutral.
The Las Cruces, New Mexico-based space tourism company went public in October 2019 with a SPAC backed by billionaire investor Chamath Palihapitiya. Since then, it's run into problems.
Shares tumbled in February after the spaceflight company delayed the test flight of its SpaceShipTwo vehicle "Unity" because of electromagnetic interference. The planned flight had been the company's second attempt after its rocket failed to reach outer space in December.
The test was rescheduled for May 22. The upcoming flight will be crewed by two pilots and carry research payloads as part of the NASA Flight Opportunities program, the company said in a press release. It will also test out other key aspects of the flight, such as work that was done to lower electromagnetic interference following the December test.
Insider previoulsy reported that if the Saturday test is sucessful, the company will plan a second powered flight, which will be a key step before commercial flights can begin.
Virgin Galactic tumbled again in March when Palihapitiya, the company's chairman, cashed out 6.2 million shares of the company for $211 million. He'd sold 3.8 million shares in December as well. He and his business partner Ian Osborne, still indirectly own millions of shares via their investment vehicle, SCH Sponsor Corp, though.
A month later, Richard Branson, the founder of the company, sold over $150 million in Virgin Galactic stock, CNBC reported.
Virgin Galactic became a cult stock earlier this year, according to Reuters, as retail traders drove the price to all-time highs in January and February. Short sellers have dug in on the stock though, as it's shorted at 15.52% of its float, MarketBeat data show.