Jason Ryan, Staff
Header Image: BARRON’s
Virgin Galactic Stock jumps almost 30 percent as spaceflight ticket sales open Wednesday that require a $150,000 deposit.
Space tourism company Virgin Galactic is getting closer and closer to commercial operations. The company announced Tuesday that it will open ticket sales to the public for the first time on Wednesday. This announcement should excite aspiring astronauts and thrill-seeking investors.
For the soon-to-be astronauts that are seeking passage to space, the process is as simple as going to virgingalactic.com and starting the application. To book a reservation spot, Virgin Galactic requires a $150,000 deposit, so those interested will have to put a pretty penny into the experience.
Additionally, Virgin Galactic ticket prices start at $450,000 each. The company revealed, last year, three different sales offerings: a single seat purchase, packaged seats for couples, friends or family or opportunities to book entire flights. The company has said previously that, of the $150,000 deposit, $25,000 is nonrefundable.
These flights consist of a 90-minute journey, including the launch and boost into space. Virgin Galactic also states, however, they are only going to sign up 1,000 customers on board to start its commercial service later in 2022.
As for investors, shares of Virgin Galactic stock jumped almost 30 percent in trading to $10.56 by midday. The stock has been beaten over the past 12 months, dropping 80 percent, with the company having delayed the beginning of commercial space flights to late this year. The S&P 500 Index and the Dow Jones Industrial Average percent were up 1.2 percent and 1.1 percent, respectively.
The stock is jumping because the start of commercial operations has been a long time coming. To explain, numerous delays due to spacecraft testing sent shares plummeting shortly after they soared, just around the time the company sent founder Sir. Richard Branson into space.
This is certainly positive news for the company. Until now, Virgin Galactic has essentially been a pre-revenue business, and 1,000 customers paying $450,000 each in 2022 translates into $450 million of actual revenue for the business. Moreover, Tuesday’s announcement can be considered a relief for investors. It is estimated that just the deposits themselves will generate about $150 million in working capital for the company.
It will be interesting to see how Virgin Galactic’s stock price acts in the coming weeks as more and more people participate in the hype of open reservations for commercial space travel.